Correlation Between The Hartford and Ab Small
Can any of the company-specific risk be diversified away by investing in both The Hartford and Ab Small 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 Ab Small 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 Ab Small Cap, you can compare the effects of market volatilities on The Hartford and Ab Small 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 Ab Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and Ab Small.
Diversification Opportunities for The Hartford and Ab Small
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between The and QUAIX is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Healthcare and Ab Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab 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 Ab Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Small Cap has no effect on the direction of The Hartford i.e., The Hartford and Ab Small go up and down completely randomly.
Pair Corralation between The Hartford and Ab Small
Assuming the 90 days horizon The Hartford Healthcare is expected to under-perform the Ab Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, The Hartford Healthcare is 1.04 times less risky than Ab Small. The mutual fund trades about -0.25 of its potential returns per unit of risk. The Ab Small Cap is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 7,749 in Ab Small Cap on October 11, 2024 and sell it today you would lose (347.00) from holding Ab Small Cap or give up 4.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Healthcare vs. Ab Small Cap
Performance |
| Timeline |
| The Hartford Healthcare |
| Ab Small Cap |
The Hartford and Ab Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and Ab Small
The main advantage of trading using opposite The Hartford and Ab Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford position performs unexpectedly, Ab Small 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 Ab Small will offset losses from the drop in Ab Small'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 |
| Ab Small vs. Baron Health Care | Ab Small vs. Hartford Healthcare Hls | Ab Small vs. Prudential Health Sciences | Ab Small vs. The Hartford Healthcare |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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