Correlation Between Hartford International and Small Cap
Can any of the company-specific risk be diversified away by investing in both Hartford International and Small Cap 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 International and Small Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford International and Small Cap Equity, you can compare the effects of market volatilities on Hartford International and Small Cap 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 International with a short position of Small Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford International and Small Cap.
Diversification Opportunities for Hartford International and Small Cap
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hartford and Small is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford International and Small Cap Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Cap Equity and Hartford International 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 International are associated (or correlated) with Small Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Cap Equity has no effect on the direction of Hartford International i.e., Hartford International and Small Cap go up and down completely randomly.
Pair Corralation between Hartford International and Small Cap
Assuming the 90 days horizon Hartford International is expected to generate 1.39 times less return on investment than Small Cap. But when comparing it to its historical volatility, The Hartford International is 1.51 times less risky than Small Cap. It trades about 0.03 of its potential returns per unit of risk. Small Cap Equity is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,584 in Small Cap Equity on October 9, 2024 and sell it today you would earn a total of 223.00 from holding Small Cap Equity or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford International vs. Small Cap Equity
Performance |
| Timeline |
| Hartford International |
| Small Cap Equity |
Hartford International and Small Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford International and Small Cap
The main advantage of trading using opposite Hartford International and Small Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford International position performs unexpectedly, Small Cap 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 Small Cap will offset losses from the drop in Small Cap's long position.| Hartford International vs. Fmasx | Hartford International vs. Kirr Marbach Partners | Hartford International vs. Tax Managed Large Cap | Hartford International vs. Rbc Microcap Value |
| Small Cap vs. Short Term Government Fund | Small Cap vs. Intermediate Government Bond | Small Cap vs. Ab Government Exchange | Small Cap vs. Dreyfus Government Cash |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |