Correlation Between American Express and Hartford Short
Can any of the company-specific risk be diversified away by investing in both American Express and Hartford Short 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 Express and Hartford Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Hartford Short Duration, you can compare the effects of market volatilities on American Express and Hartford Short 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 Express with a short position of Hartford Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Hartford Short.
Diversification Opportunities for American Express and Hartford Short
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between American and Hartford is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Hartford Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Short Duration and American Express 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 Express are associated (or correlated) with Hartford Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Short Duration has no effect on the direction of American Express i.e., American Express and Hartford Short go up and down completely randomly.
Pair Corralation between American Express and Hartford Short
Considering the 90-day investment horizon American Express is expected to generate 18.88 times more return on investment than Hartford Short. However, American Express is 18.88 times more volatile than Hartford Short Duration. It trades about 0.28 of its potential returns per unit of risk. Hartford Short Duration is currently generating about 0.27 per unit of risk. If you would invest 27,043 in American Express on August 30, 2024 and sell it today you would earn a total of 3,382 from holding American Express or generate 12.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Express vs. Hartford Short Duration
Performance |
| Timeline |
| American Express |
| Hartford Short Duration |
American Express and Hartford Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Hartford Short
The main advantage of trading using opposite American Express and Hartford Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Hartford Short 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 Short will offset losses from the drop in Hartford Short's long position.| American Express vs. 360 Finance | American Express vs. Atlanticus Holdings | American Express vs. X Financial Class | American Express vs. Yirendai |
| Hartford Short vs. Hartford Total Return | Hartford Short vs. iShares Edge Investment | Hartford Short vs. Hartford Schroders Tax Aware | Hartford Short vs. ClearShares Ultra Short Maturity |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |