Correlation Between Barings Active and Hartford Stock
Can any of the company-specific risk be diversified away by investing in both Barings Active and Hartford Stock 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 Barings Active and Hartford Stock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Active Short and Hartford Stock Hls, you can compare the effects of market volatilities on Barings Active and Hartford Stock 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 Barings Active with a short position of Hartford Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Hartford Stock.
Diversification Opportunities for Barings Active and Hartford Stock
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Barings and Hartford is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Hartford Stock Hls in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Stock Hls and Barings Active 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 Barings Active Short are associated (or correlated) with Hartford Stock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Stock Hls has no effect on the direction of Barings Active i.e., Barings Active and Hartford Stock go up and down completely randomly.
Pair Corralation between Barings Active and Hartford Stock
Assuming the 90 days horizon Barings Active is expected to generate 3.13 times less return on investment than Hartford Stock. But when comparing it to its historical volatility, Barings Active Short is 4.04 times less risky than Hartford Stock. It trades about 0.15 of its potential returns per unit of risk. Hartford Stock Hls is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 10,464 in Hartford Stock Hls on August 28, 2024 and sell it today you would earn a total of 140.00 from holding Hartford Stock Hls or generate 1.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Active Short vs. Hartford Stock Hls
Performance |
| Timeline |
| Barings Active Short |
| Hartford Stock Hls |
Barings Active and Hartford Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Hartford Stock
The main advantage of trading using opposite Barings Active and Hartford Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Hartford Stock 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 Stock will offset losses from the drop in Hartford Stock's long position.| Barings Active vs. Janus Global Technology | Barings Active vs. Invesco Technology Fund | Barings Active vs. Janus Global Technology | Barings Active vs. Towpath Technology |
| Hartford Stock vs. The Hartford Growth | Hartford Stock vs. The Hartford Growth | Hartford Stock vs. The Hartford Growth | Hartford Stock 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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