Correlation Between Baird Small/mid and The Hartford
Can any of the company-specific risk be diversified away by investing in both Baird Small/mid 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 Baird Small/mid and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baird Smallmid Cap and The Hartford Small, you can compare the effects of market volatilities on Baird Small/mid 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 Baird Small/mid with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Small/mid and The Hartford.
Diversification Opportunities for Baird Small/mid and The Hartford
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Baird and The is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Baird Smallmid Cap and The Hartford Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Small and Baird Small/mid 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 Baird Smallmid Cap 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 Hartford Small has no effect on the direction of Baird Small/mid i.e., Baird Small/mid and The Hartford go up and down completely randomly.
Pair Corralation between Baird Small/mid and The Hartford
Assuming the 90 days horizon Baird Small/mid is expected to generate 2.78 times less return on investment than The Hartford. But when comparing it to its historical volatility, Baird Smallmid Cap is 1.13 times less risky than The Hartford. It trades about 0.02 of its potential returns per unit of risk. The Hartford Small is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,339 in The Hartford Small on November 27, 2024 and sell it today you would earn a total of 545.00 from holding The Hartford Small or generate 23.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baird Smallmid Cap vs. The Hartford Small
Performance |
| Timeline |
| Baird Smallmid Cap |
| Hartford Small |
Baird Small/mid and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baird Small/mid and The Hartford
The main advantage of trading using opposite Baird Small/mid and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Small/mid 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.| Baird Small/mid vs. United Kingdom Small | Baird Small/mid vs. Ashmore Emerging Markets | Baird Small/mid vs. Ab Small Cap | Baird Small/mid vs. Ab Small Cap |
| The Hartford vs. Transamerica Financial Life | The Hartford vs. Blackrock Smid Cap Growth | The Hartford vs. T Rowe Price | The Hartford vs. T Rowe Price |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |