Correlation Between American Mutual and Hartford Global
Can any of the company-specific risk be diversified away by investing in both American Mutual and Hartford Global 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 American Mutual and Hartford Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Mutual Fund and Hartford Global Impact, you can compare the effects of market volatilities on American Mutual and Hartford Global 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 American Mutual with a short position of Hartford Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Mutual and Hartford Global.
Diversification Opportunities for American Mutual and Hartford Global
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between American and Hartford is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding American Mutual Fund and Hartford Global Impact in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Global Impact and American Mutual 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 American Mutual Fund are associated (or correlated) with Hartford Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Global Impact has no effect on the direction of American Mutual i.e., American Mutual and Hartford Global go up and down completely randomly.
Pair Corralation between American Mutual and Hartford Global
Assuming the 90 days horizon American Mutual Fund is expected to generate 0.77 times more return on investment than Hartford Global. However, American Mutual Fund is 1.29 times less risky than Hartford Global. It trades about 0.08 of its potential returns per unit of risk. Hartford Global Impact is currently generating about 0.05 per unit of risk. If you would invest 4,536 in American Mutual Fund on November 28, 2024 and sell it today you would earn a total of 1,211 from holding American Mutual Fund or generate 26.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Mutual Fund vs. Hartford Global Impact
Performance |
| Timeline |
| American Mutual |
| Hartford Global Impact |
American Mutual and Hartford Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Mutual and Hartford Global
The main advantage of trading using opposite American Mutual and Hartford Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Mutual position performs unexpectedly, Hartford Global 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 Hartford Global will offset losses from the drop in Hartford Global's long position.| American Mutual vs. Amcap Fund Class | American Mutual vs. American Balanced Fund | American Mutual vs. New Perspective Fund | American Mutual vs. New World Fund |
| Hartford Global vs. Msift High Yield | Hartford Global vs. Pace High Yield | Hartford Global vs. Ab High Income | Hartford Global vs. Metropolitan West High |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |