Correlation Between Hartford Inflation and Western Asset
Can any of the company-specific risk be diversified away by investing in both Hartford Inflation and Western Asset 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 Inflation and Western Asset 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 Western Asset E, you can compare the effects of market volatilities on Hartford Inflation and Western Asset 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 Inflation with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Inflation and Western Asset.
Diversification Opportunities for Hartford Inflation and Western Asset
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hartford and Western is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Inflation and Western Asset E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset E and Hartford Inflation 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 Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset E has no effect on the direction of Hartford Inflation i.e., Hartford Inflation and Western Asset go up and down completely randomly.
Pair Corralation between Hartford Inflation and Western Asset
Assuming the 90 days horizon The Hartford Inflation is expected to generate 0.71 times more return on investment than Western Asset. However, The Hartford Inflation is 1.41 times less risky than Western Asset. It trades about 0.04 of its potential returns per unit of risk. Western Asset E is currently generating about 0.02 per unit of risk. If you would invest 941.00 in The Hartford Inflation on September 3, 2024 and sell it today you would earn a total of 61.00 from holding The Hartford Inflation or generate 6.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Inflation vs. Western Asset E
Performance |
| Timeline |
| The Hartford Inflation |
| Western Asset E |
Hartford Inflation and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Inflation and Western Asset
The main advantage of trading using opposite Hartford Inflation and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Inflation position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Hartford Inflation vs. Rbc Small Cap | Hartford Inflation vs. Ab Small Cap | Hartford Inflation vs. Ancorathelen Small Mid Cap | Hartford Inflation vs. Fisher Small Cap |
| Western Asset vs. Morningstar Aggressive Growth | Western Asset vs. Vanguard Star Fund | Western Asset vs. Ab Global Risk | Western Asset vs. Artisan High Income |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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