Correlation Between Hartford Healthcare and Highland Floating
Can any of the company-specific risk be diversified away by investing in both Hartford Healthcare and Highland Floating 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 Highland Floating 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 Highland Floating Rate, you can compare the effects of market volatilities on Hartford Healthcare and Highland Floating 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 Highland Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Healthcare and Highland Floating.
Diversification Opportunities for Hartford Healthcare and Highland Floating
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hartford and Highland is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Healthcare Hls and Highland Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highland Floating Rate 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 Highland Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highland Floating Rate has no effect on the direction of Hartford Healthcare i.e., Hartford Healthcare and Highland Floating go up and down completely randomly.
Pair Corralation between Hartford Healthcare and Highland Floating
Assuming the 90 days horizon Hartford Healthcare is expected to generate 3.33 times less return on investment than Highland Floating. In addition to that, Hartford Healthcare is 1.43 times more volatile than Highland Floating Rate. It trades about 0.01 of its total potential returns per unit of risk. Highland Floating Rate is currently generating about 0.06 per unit of volatility. If you would invest 786.00 in Highland Floating Rate on September 1, 2024 and sell it today you would earn a total of 31.00 from holding Highland Floating Rate or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Hartford Healthcare Hls vs. Highland Floating Rate
Performance |
| Timeline |
| Hartford Healthcare Hls |
| Highland Floating Rate |
Hartford Healthcare and Highland Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Healthcare and Highland Floating
The main advantage of trading using opposite Hartford Healthcare and Highland Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Healthcare position performs unexpectedly, Highland Floating 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 Highland Floating will offset losses from the drop in Highland Floating's long position.| Hartford Healthcare vs. Precious Metals And | Hartford Healthcare vs. Gabelli Gold Fund | Hartford Healthcare vs. James Balanced Golden | Hartford Healthcare vs. Great West Goldman Sachs |
| Highland Floating vs. Harding Loevner Funds | Highland Floating vs. Harding Loevner Emerging | Highland Floating vs. Harding Loevner Institutional | Highland Floating vs. Harding Loevner Global |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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