Correlation Between Highland Long/short and The Hartford
Can any of the company-specific risk be diversified away by investing in both Highland Long/short and The Hartford 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 Highland Long/short and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highland Longshort Healthcare and The Hartford Healthcare, you can compare the effects of market volatilities on Highland Long/short and The Hartford 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 Highland Long/short with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Long/short and The Hartford.
Diversification Opportunities for Highland Long/short and The Hartford
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Highland and The is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Highland Longshort Healthcare and The Hartford Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hartford Healthcare and Highland Long/short 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 Highland Longshort Healthcare are associated (or correlated) with The Hartford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hartford Healthcare has no effect on the direction of Highland Long/short i.e., Highland Long/short and The Hartford go up and down completely randomly.
Pair Corralation between Highland Long/short and The Hartford
Assuming the 90 days horizon Highland Long/short is expected to generate 1.08 times less return on investment than The Hartford. But when comparing it to its historical volatility, Highland Longshort Healthcare is 3.97 times less risky than The Hartford. It trades about 0.1 of its potential returns per unit of risk. The Hartford Healthcare is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4,259 in The Hartford Healthcare on September 3, 2024 and sell it today you would earn a total of 115.00 from holding The Hartford Healthcare or generate 2.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highland Longshort Healthcare vs. The Hartford Healthcare
Performance |
| Timeline |
| Highland Long/short |
| The Hartford Healthcare |
Highland Long/short and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highland Long/short and The Hartford
The main advantage of trading using opposite Highland Long/short and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highland Long/short position performs unexpectedly, The Hartford 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 The Hartford will offset losses from the drop in The Hartford's long position.| Highland Long/short vs. Ab Value Fund | Highland Long/short vs. Balanced Fund Investor | Highland Long/short vs. Rbb Fund | Highland Long/short vs. Omni Small Cap Value |
| The Hartford vs. California Bond Fund | The Hartford vs. Gmo High Yield | The Hartford vs. Dreyfusstandish Global Fixed | The Hartford vs. Maryland Tax Free Bond |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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