Correlation Between Boston Trust and The Hartford
Can any of the company-specific risk be diversified away by investing in both Boston Trust 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 Boston Trust and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Trust Midcap and The Hartford Equity, you can compare the effects of market volatilities on Boston Trust 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 Boston Trust with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Trust and The Hartford.
Diversification Opportunities for Boston Trust and The Hartford
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Boston and The is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Boston Trust Midcap and The Hartford Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Equity and Boston Trust 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 Boston Trust Midcap 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 Equity has no effect on the direction of Boston Trust i.e., Boston Trust and The Hartford go up and down completely randomly.
Pair Corralation between Boston Trust and The Hartford
Assuming the 90 days horizon Boston Trust is expected to generate 1.11 times less return on investment than The Hartford. In addition to that, Boston Trust is 1.22 times more volatile than The Hartford Equity. It trades about 0.09 of its total potential returns per unit of risk. The Hartford Equity is currently generating about 0.12 per unit of volatility. If you would invest 1,911 in The Hartford Equity on September 4, 2024 and sell it today you would earn a total of 384.00 from holding The Hartford Equity or generate 20.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Trust Midcap vs. The Hartford Equity
Performance |
| Timeline |
| Boston Trust Midcap |
| Hartford Equity |
Boston Trust and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Trust and The Hartford
The main advantage of trading using opposite Boston Trust and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Trust 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.| Boston Trust vs. Boston Trust Asset | Boston Trust vs. Virtus Kar Mid Cap | Boston Trust vs. Virtus Kar Mid Cap | Boston Trust vs. Boston Trust Small |
| The Hartford vs. Invesco Developing Markets | The Hartford vs. Delaware Diversified Income | The Hartford vs. Mfs Growth Fund | The Hartford vs. The Hartford Balanced |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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