Correlation Between The Hartford and American High
Can any of the company-specific risk be diversified away by investing in both The Hartford and American High 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 The Hartford and American High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Inflation and American High Income, you can compare the effects of market volatilities on The Hartford and American High 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 The Hartford with a short position of American High. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and American High.
Diversification Opportunities for The Hartford and American High
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between The and American is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Inflation and American High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American High Income and The Hartford 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 Inflation are associated (or correlated) with American High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American High Income has no effect on the direction of The Hartford i.e., The Hartford and American High go up and down completely randomly.
Pair Corralation between The Hartford and American High
Assuming the 90 days horizon The Hartford is expected to generate 2.39 times less return on investment than American High. In addition to that, The Hartford is 1.25 times more volatile than American High Income. It trades about 0.06 of its total potential returns per unit of risk. American High Income is currently generating about 0.19 per unit of volatility. If you would invest 917.00 in American High Income on September 1, 2024 and sell it today you would earn a total of 68.00 from holding American High Income or generate 7.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Inflation vs. American High Income
Performance |
| Timeline |
| The Hartford Inflation |
| American High Income |
The Hartford and American High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and American High
The main advantage of trading using opposite The Hartford and American High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford position performs unexpectedly, American High 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 American High will offset losses from the drop in American High's long position.| The Hartford vs. Hartford Growth Opportunities | The Hartford vs. The Hartford Growth | The Hartford vs. Hartford Global Impact | The Hartford vs. Hartford Global Impact |
| American High vs. Income Fund Of | American High vs. New World Fund | American High vs. American Mutual Fund | American High vs. American Mutual Fund |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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