Correlation Between Hartford Healthcare and Aberdeen Emerging
Can any of the company-specific risk be diversified away by investing in both Hartford Healthcare and Aberdeen Emerging 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 Aberdeen Emerging 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 Aberdeen Emerging Markets, you can compare the effects of market volatilities on Hartford Healthcare and Aberdeen Emerging 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 Aberdeen Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Healthcare and Aberdeen Emerging.
Diversification Opportunities for Hartford Healthcare and Aberdeen Emerging
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HARTFORD and Aberdeen is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Healthcare Hls and Aberdeen Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Emerging Markets 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 Aberdeen Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Emerging Markets has no effect on the direction of Hartford Healthcare i.e., Hartford Healthcare and Aberdeen Emerging go up and down completely randomly.
Pair Corralation between Hartford Healthcare and Aberdeen Emerging
Assuming the 90 days horizon Hartford Healthcare Hls is expected to under-perform the Aberdeen Emerging. In addition to that, Hartford Healthcare is 1.17 times more volatile than Aberdeen Emerging Markets. It trades about -0.1 of its total potential returns per unit of risk. Aberdeen Emerging Markets is currently generating about -0.09 per unit of volatility. If you would invest 1,421 in Aberdeen Emerging Markets on October 24, 2024 and sell it today you would lose (61.00) from holding Aberdeen Emerging Markets or give up 4.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
Hartford Healthcare Hls vs. Aberdeen Emerging Markets
Performance |
| Timeline |
| Hartford Healthcare Hls |
| Aberdeen Emerging Markets |
Hartford Healthcare and Aberdeen Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Healthcare and Aberdeen Emerging
The main advantage of trading using opposite Hartford Healthcare and Aberdeen Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Healthcare position performs unexpectedly, Aberdeen Emerging 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 Aberdeen Emerging will offset losses from the drop in Aberdeen Emerging's long position.| Hartford Healthcare vs. Transamerica Large Cap | Hartford Healthcare vs. Tax Managed Large Cap | Hartford Healthcare vs. Avantis Large Cap | Hartford Healthcare vs. Qs Large Cap |
| Aberdeen Emerging vs. Baron Health Care | Aberdeen Emerging vs. Hartford Healthcare Hls | Aberdeen Emerging vs. Hartford Healthcare Hls | Aberdeen Emerging vs. Health Care Ultrasector |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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