Correlation Between Hartford Healthcare and Eventide Healthcare
Can any of the company-specific risk be diversified away by investing in both Hartford Healthcare and Eventide Healthcare 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 Healthcare and Eventide Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Healthcare Hls and Eventide Healthcare Life, you can compare the effects of market volatilities on Hartford Healthcare and Eventide Healthcare 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 Healthcare with a short position of Eventide Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Healthcare and Eventide Healthcare.
Diversification Opportunities for Hartford Healthcare and Eventide Healthcare
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hartford and Eventide is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Healthcare Hls and Eventide Healthcare Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eventide Healthcare Life and Hartford Healthcare 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 Healthcare Hls are associated (or correlated) with Eventide Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eventide Healthcare Life has no effect on the direction of Hartford Healthcare i.e., Hartford Healthcare and Eventide Healthcare go up and down completely randomly.
Pair Corralation between Hartford Healthcare and Eventide Healthcare
Assuming the 90 days horizon Hartford Healthcare is expected to generate 1.1 times less return on investment than Eventide Healthcare. But when comparing it to its historical volatility, Hartford Healthcare Hls is 1.47 times less risky than Eventide Healthcare. It trades about 0.3 of its potential returns per unit of risk. Eventide Healthcare Life is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3,272 in Eventide Healthcare Life on November 3, 2024 and sell it today you would earn a total of 202.00 from holding Eventide Healthcare Life or generate 6.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hartford Healthcare Hls vs. Eventide Healthcare Life
Performance |
| Timeline |
| Hartford Healthcare Hls |
| Eventide Healthcare Life |
Hartford Healthcare and Eventide Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Healthcare and Eventide Healthcare
The main advantage of trading using opposite Hartford Healthcare and Eventide Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Healthcare position performs unexpectedly, Eventide Healthcare 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 Eventide Healthcare will offset losses from the drop in Eventide Healthcare's long position.| Hartford Healthcare vs. T Rowe Price | Hartford Healthcare vs. Gmo Emerging Ntry | Hartford Healthcare vs. Artisan High Income | Hartford Healthcare vs. Multisector Bond Sma |
| Eventide Healthcare vs. Morningstar Defensive Bond | Eventide Healthcare vs. Ab Global Bond | Eventide Healthcare vs. Old Westbury California | Eventide Healthcare vs. Barings High Yield |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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