Correlation Between The Hartford and Touchstone Value
Can any of the company-specific risk be diversified away by investing in both The Hartford and Touchstone Value 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 The Hartford and Touchstone Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Floating and Touchstone Value Fund, you can compare the effects of market volatilities on The Hartford and Touchstone Value 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 The Hartford with a short position of Touchstone Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and Touchstone Value.
Diversification Opportunities for The Hartford and Touchstone Value
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between The and Touchstone is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Floating and Touchstone Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Value and The Hartford 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 The Hartford Floating are associated (or correlated) with Touchstone Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Value has no effect on the direction of The Hartford i.e., The Hartford and Touchstone Value go up and down completely randomly.
Pair Corralation between The Hartford and Touchstone Value
Assuming the 90 days horizon The Hartford is expected to generate 18.83 times less return on investment than Touchstone Value. But when comparing it to its historical volatility, The Hartford Floating is 10.74 times less risky than Touchstone Value. It trades about 0.18 of its potential returns per unit of risk. Touchstone Value Fund is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,281 in Touchstone Value Fund on September 1, 2024 and sell it today you would earn a total of 65.00 from holding Touchstone Value Fund or generate 5.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
The Hartford Floating vs. Touchstone Value Fund
Performance |
| Timeline |
| Hartford Floating |
| Touchstone Value |
The Hartford and Touchstone Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and Touchstone Value
The main advantage of trading using opposite The Hartford and Touchstone Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford position performs unexpectedly, Touchstone Value 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 Touchstone Value will offset losses from the drop in Touchstone Value's long position.| The Hartford vs. Lord Abbett Diversified | The Hartford vs. Small Cap Stock | The Hartford vs. Oppenheimer International Diversified | The Hartford vs. Adams Diversified Equity |
| Touchstone Value vs. Tfa Alphagen Growth | Touchstone Value vs. Chase Growth Fund | Touchstone Value vs. Kinetics Small Cap | Touchstone Value vs. L Abbett 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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