Correlation Between DAX Index and Hartford Financial
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By analyzing existing cross correlation between DAX Index and The Hartford Financial, you can compare the effects of market volatilities on DAX Index and Hartford Financial 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 DAX Index with a short position of Hartford Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Hartford Financial.
Diversification Opportunities for DAX Index and Hartford Financial
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and Hartford is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and The Hartford Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hartford Financial and DAX Index 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 DAX Index are associated (or correlated) with Hartford Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hartford Financial has no effect on the direction of DAX Index i.e., DAX Index and Hartford Financial go up and down completely randomly.
Pair Corralation between DAX Index and Hartford Financial
Assuming the 90 days trading horizon DAX Index is expected to generate 2.82 times less return on investment than Hartford Financial. But when comparing it to its historical volatility, DAX Index is 1.83 times less risky than Hartford Financial. It trades about 0.21 of its potential returns per unit of risk. The Hartford Financial is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 10,155 in The Hartford Financial on September 5, 2024 and sell it today you would earn a total of 1,345 from holding The Hartford Financial or generate 13.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. The Hartford Financial
Performance |
| Timeline |
DAX Index and Hartford Financial Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
The Hartford Financial
Pair trading matchups for Hartford Financial
Pair Trading with DAX Index and Hartford Financial
The main advantage of trading using opposite DAX Index and Hartford Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Hartford Financial 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 Financial will offset losses from the drop in Hartford Financial's long position.| DAX Index vs. Hochschild Mining plc | DAX Index vs. Ming Le Sports | DAX Index vs. PLAYSTUDIOS A DL 0001 | DAX Index vs. USWE SPORTS AB |
| Hartford Financial vs. Berkshire Hathaway | Hartford Financial vs. AXA SA | Hartford Financial vs. AXA SA | Hartford Financial vs. Swiss Life Holding |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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