Correlation Between Hartford Moderate and Legg Mason
Can any of the company-specific risk be diversified away by investing in both Hartford Moderate and Legg Mason 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 Hartford Moderate and Legg Mason into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Moderate Allocation and Legg Mason Bw, you can compare the effects of market volatilities on Hartford Moderate and Legg Mason 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 Hartford Moderate with a short position of Legg Mason. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Moderate and Legg Mason.
Diversification Opportunities for Hartford Moderate and Legg Mason
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HARTFORD and Legg is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Moderate Allocation and Legg Mason Bw in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Legg Mason Bw and Hartford Moderate 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 Hartford Moderate Allocation are associated (or correlated) with Legg Mason. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Legg Mason Bw has no effect on the direction of Hartford Moderate i.e., Hartford Moderate and Legg Mason go up and down completely randomly.
Pair Corralation between Hartford Moderate and Legg Mason
Assuming the 90 days horizon Hartford Moderate Allocation is expected to generate 0.85 times more return on investment than Legg Mason. However, Hartford Moderate Allocation is 1.17 times less risky than Legg Mason. It trades about 0.07 of its potential returns per unit of risk. Legg Mason Bw is currently generating about -0.1 per unit of risk. If you would invest 1,308 in Hartford Moderate Allocation on November 27, 2024 and sell it today you would earn a total of 8.00 from holding Hartford Moderate Allocation or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hartford Moderate Allocation vs. Legg Mason Bw
Performance |
| Timeline |
| Hartford Moderate |
| Legg Mason Bw |
Hartford Moderate and Legg Mason Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Moderate and Legg Mason
The main advantage of trading using opposite Hartford Moderate and Legg Mason positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Moderate position performs unexpectedly, Legg Mason 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 Legg Mason will offset losses from the drop in Legg Mason's long position.| Hartford Moderate vs. Amg Managers Centersquare | Hartford Moderate vs. Voya Real Estate | Hartford Moderate vs. Real Estate Ultrasector | Hartford Moderate vs. Rreef Property Trust |
| Legg Mason vs. Fidelity Large Cap | Legg Mason vs. Old Westbury Large | Legg Mason vs. Profunds Large Cap Growth | Legg Mason vs. Tax Managed Large Cap |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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