Correlation Between The Hartford and Omni Small-cap
Can any of the company-specific risk be diversified away by investing in both The Hartford and Omni Small-cap 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 Omni Small-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Healthcare and Omni Small Cap Value, you can compare the effects of market volatilities on The Hartford and Omni Small-cap 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 Omni Small-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and Omni Small-cap.
Diversification Opportunities for The Hartford and Omni Small-cap
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between The and Omni is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Healthcare and Omni Small Cap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omni Small Cap 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 Healthcare are associated (or correlated) with Omni Small-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omni Small Cap has no effect on the direction of The Hartford i.e., The Hartford and Omni Small-cap go up and down completely randomly.
Pair Corralation between The Hartford and Omni Small-cap
Assuming the 90 days horizon The Hartford Healthcare is expected to generate 0.76 times more return on investment than Omni Small-cap. However, The Hartford Healthcare is 1.31 times less risky than Omni Small-cap. It trades about -0.25 of its potential returns per unit of risk. Omni Small Cap Value is currently generating about -0.41 per unit of risk. If you would invest 4,745 in The Hartford Healthcare on October 11, 2024 and sell it today you would lose (314.00) from holding The Hartford Healthcare or give up 6.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Healthcare vs. Omni Small Cap Value
Performance |
| Timeline |
| The Hartford Healthcare |
| Omni Small Cap |
The Hartford and Omni Small-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and Omni Small-cap
The main advantage of trading using opposite The Hartford and Omni Small-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford position performs unexpectedly, Omni Small-cap 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 Omni Small-cap will offset losses from the drop in Omni Small-cap's long position.| The Hartford vs. The Hartford Healthcare | The Hartford vs. Hartford Healthcare Hls | The Hartford vs. The Hartford Global | The Hartford vs. Hartford Healthcare Hls |
| Omni Small-cap vs. The Gabelli Healthcare | Omni Small-cap vs. The Hartford Healthcare | Omni Small-cap vs. Tekla Healthcare Investors | Omni Small-cap vs. Vanguard Health Care |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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