Correlation Between Hartford Financial and AXA SA
Can any of the company-specific risk be diversified away by investing in both Hartford Financial and AXA SA 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 AXA SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Financial Services and AXA SA, you can compare the effects of market volatilities on Hartford Financial and AXA SA 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 AXA SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Financial and AXA SA.
Diversification Opportunities for Hartford Financial and AXA SA
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hartford and AXA is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Financial Services and AXA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXA SA 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 Hartford Financial Services are associated (or correlated) with AXA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXA SA has no effect on the direction of Hartford Financial i.e., Hartford Financial and AXA SA go up and down completely randomly.
Pair Corralation between Hartford Financial and AXA SA
Considering the 90-day investment horizon Hartford Financial Services is expected to generate 1.55 times more return on investment than AXA SA. However, Hartford Financial is 1.55 times more volatile than AXA SA. It trades about 0.01 of its potential returns per unit of risk. AXA SA is currently generating about -0.28 per unit of risk. If you would invest 11,985 in Hartford Financial Services on August 24, 2024 and sell it today you would lose (21.00) from holding Hartford Financial Services or give up 0.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hartford Financial Services vs. AXA SA
Performance |
| Timeline |
| Hartford Financial |
| AXA SA |
Hartford Financial and AXA SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Financial and AXA SA
The main advantage of trading using opposite Hartford Financial and AXA SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Financial position performs unexpectedly, AXA SA 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 AXA SA will offset losses from the drop in AXA SA's long position.| Hartford Financial vs. Goosehead Insurance | Hartford Financial vs. International General Insurance | Hartford Financial vs. Enstar Group Limited | Hartford Financial vs. Arch Capital Group |
| AXA SA vs. Assicurazioni Generali SpA | AXA SA vs. Athene Holding | AXA SA vs. Athene Holding | AXA SA vs. Arch Capital Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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