Correlation Between Ab Bond and The Hartford
Can any of the company-specific risk be diversified away by investing in both Ab Bond and The Hartford at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Ab Bond and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Bond Inflation and The Hartford Inflation, you can compare the effects of market volatilities on Ab Bond and The Hartford and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Ab Bond with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and The Hartford.
Diversification Opportunities for Ab Bond and The Hartford
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ABNCX and The is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and The Hartford Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hartford Inflation and Ab Bond is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Ab Bond Inflation are associated (or correlated) with The Hartford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hartford Inflation has no effect on the direction of Ab Bond i.e., Ab Bond and The Hartford go up and down completely randomly.
Pair Corralation between Ab Bond and The Hartford
Assuming the 90 days horizon Ab Bond Inflation is expected to under-perform the The Hartford. In addition to that, Ab Bond is 1.02 times more volatile than The Hartford Inflation. It trades about -0.13 of its total potential returns per unit of risk. The Hartford Inflation is currently generating about -0.13 per unit of volatility. If you would invest 1,032 in The Hartford Inflation on January 12, 2025 and sell it today you would lose (11.00) from holding The Hartford Inflation or give up 1.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Bond Inflation vs. The Hartford Inflation
Performance |
| Timeline |
| Ab Bond Inflation |
| The Hartford Inflation |
Ab Bond and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and The Hartford
The main advantage of trading using opposite Ab Bond and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, The Hartford can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in The Hartford will offset losses from the drop in The Hartford's long position.| Ab Bond vs. American Century High | Ab Bond vs. California High Yield Municipal | Ab Bond vs. Inverse High Yield | Ab Bond vs. Gmo High Yield |
| The Hartford vs. The Hartford Growth | The Hartford vs. The Hartford Growth | The Hartford vs. The Hartford Growth | The Hartford vs. The Hartford Growth |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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