Correlation Between Barings Emerging and Hartford Stock
Can any of the company-specific risk be diversified away by investing in both Barings Emerging 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 Emerging 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 Emerging Markets and Hartford Stock Hls, you can compare the effects of market volatilities on Barings Emerging 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 Emerging with a short position of Hartford Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Hartford Stock.
Diversification Opportunities for Barings Emerging and Hartford Stock
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Barings and Hartford is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets 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 Emerging 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 Emerging Markets 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 Emerging i.e., Barings Emerging and Hartford Stock go up and down completely randomly.
Pair Corralation between Barings Emerging and Hartford Stock
Assuming the 90 days horizon Barings Emerging is expected to generate 22.87 times less return on investment than Hartford Stock. But when comparing it to its historical volatility, Barings Emerging Markets is 1.49 times less risky than Hartford Stock. It trades about 0.02 of its potential returns per unit of risk. Hartford Stock Hls is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 10,321 in Hartford Stock Hls on September 4, 2024 and sell it today you would earn a total of 340.00 from holding Hartford Stock Hls or generate 3.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Hartford Stock Hls
Performance |
| Timeline |
| Barings Emerging Markets |
| Hartford Stock Hls |
Barings Emerging and Hartford Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Hartford Stock
The main advantage of trading using opposite Barings Emerging and Hartford Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging 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 Emerging vs. T Rowe Price | Barings Emerging vs. Volumetric Fund Volumetric | Barings Emerging vs. Rbb Fund | Barings Emerging vs. T Rowe Price |
| 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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