Correlation Between Europac Gold and The Hartford
Can any of the company-specific risk be diversified away by investing in both Europac Gold 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 Europac Gold and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Europac Gold Fund and The Hartford Growth, you can compare the effects of market volatilities on Europac Gold 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 Europac Gold with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Europac Gold and The Hartford.
Diversification Opportunities for Europac Gold and The Hartford
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Europac and The is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Europac Gold Fund and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth and Europac Gold 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 Europac Gold Fund 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 Growth has no effect on the direction of Europac Gold i.e., Europac Gold and The Hartford go up and down completely randomly.
Pair Corralation between Europac Gold and The Hartford
Assuming the 90 days horizon Europac Gold Fund is expected to under-perform the The Hartford. In addition to that, Europac Gold is 1.85 times more volatile than The Hartford Growth. It trades about -0.2 of its total potential returns per unit of risk. The Hartford Growth is currently generating about 0.13 per unit of volatility. If you would invest 6,264 in The Hartford Growth on August 31, 2024 and sell it today you would earn a total of 210.00 from holding The Hartford Growth or generate 3.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Europac Gold Fund vs. The Hartford Growth
Performance |
| Timeline |
| Europac Gold |
| Hartford Growth |
Europac Gold and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Europac Gold and The Hartford
The main advantage of trading using opposite Europac Gold and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Europac Gold 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.| Europac Gold vs. Europac International Value | Europac Gold vs. Europac International Dividend | Europac Gold vs. Ep Emerging Markets | Europac Gold vs. Europac International Bond |
| The Hartford vs. Legg Mason Partners | The Hartford vs. Ab Small Cap | The Hartford vs. Fisher Small Cap | The Hartford vs. Champlain Small |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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