Correlation Between Aam Select and Hartford International
Can any of the company-specific risk be diversified away by investing in both Aam Select and Hartford International 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 Aam Select and Hartford International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aam Select Income and The Hartford International, you can compare the effects of market volatilities on Aam Select and Hartford International 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 Aam Select with a short position of Hartford International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aam Select and Hartford International.
Diversification Opportunities for Aam Select and Hartford International
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aam and Hartford is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Aam Select Income and The Hartford International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford International and Aam Select 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 Aam Select Income are associated (or correlated) with Hartford International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford International has no effect on the direction of Aam Select i.e., Aam Select and Hartford International go up and down completely randomly.
Pair Corralation between Aam Select and Hartford International
Assuming the 90 days horizon Aam Select is expected to generate 2.14 times less return on investment than Hartford International. But when comparing it to its historical volatility, Aam Select Income is 1.99 times less risky than Hartford International. It trades about 0.06 of its potential returns per unit of risk. The Hartford International is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,483 in The Hartford International on September 14, 2024 and sell it today you would earn a total of 402.00 from holding The Hartford International or generate 27.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aam Select Income vs. The Hartford International
Performance |
| Timeline |
| Aam Select Income |
| Hartford International |
Aam Select and Hartford International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aam Select and Hartford International
The main advantage of trading using opposite Aam Select and Hartford International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aam Select position performs unexpectedly, Hartford International 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 International will offset losses from the drop in Hartford International's long position.| Aam Select vs. Mid Cap Growth | Aam Select vs. Vy Baron Growth | Aam Select vs. Qs Defensive Growth | Aam Select vs. Vy Baron 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |