Correlation Between Hartford Financial and Global Medical
Can any of the company-specific risk be diversified away by investing in both Hartford Financial and Global Medical 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 Financial and Global Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Financial and Global Medical REIT, you can compare the effects of market volatilities on Hartford Financial and Global Medical 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 Financial with a short position of Global Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Financial and Global Medical.
Diversification Opportunities for Hartford Financial and Global Medical
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hartford and Global is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Financial and Global Medical REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Medical REIT and Hartford Financial 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 Financial are associated (or correlated) with Global Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Medical REIT has no effect on the direction of Hartford Financial i.e., Hartford Financial and Global Medical go up and down completely randomly.
Pair Corralation between Hartford Financial and Global Medical
Assuming the 90 days trading horizon The Hartford Financial is expected to generate 0.53 times more return on investment than Global Medical. However, The Hartford Financial is 1.9 times less risky than Global Medical. It trades about 0.06 of its potential returns per unit of risk. Global Medical REIT is currently generating about 0.0 per unit of risk. If you would invest 2,472 in The Hartford Financial on August 28, 2024 and sell it today you would earn a total of 36.00 from holding The Hartford Financial or generate 1.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Financial vs. Global Medical REIT
Performance |
| Timeline |
| The Hartford Financial |
| Global Medical REIT |
Hartford Financial and Global Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Financial and Global Medical
The main advantage of trading using opposite Hartford Financial and Global Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Financial position performs unexpectedly, Global Medical 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 Global Medical will offset losses from the drop in Global Medical's long position.| Hartford Financial vs. Arch Capital Group | Hartford Financial vs. Athene Holding | Hartford Financial vs. Arch Capital Group | Hartford Financial vs. Athene Holding |
| Global Medical vs. Global Medical REIT | Global Medical vs. Community Healthcare Trust | Global Medical vs. National Health Investors | Global Medical vs. Healthcare Realty Trust |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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