Correlation Between Hartford Small and Fidelity International
Can any of the company-specific risk be diversified away by investing in both Hartford Small and Fidelity International 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 Small and Fidelity International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Small Cap and Fidelity International Growth, you can compare the effects of market volatilities on Hartford Small and Fidelity International 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 Small with a short position of Fidelity International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Small and Fidelity International.
Diversification Opportunities for Hartford Small and Fidelity International
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hartford and Fidelity is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Small Cap and Fidelity International Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity International and Hartford Small 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 Small Cap are associated (or correlated) with Fidelity International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity International has no effect on the direction of Hartford Small i.e., Hartford Small and Fidelity International go up and down completely randomly.
Pair Corralation between Hartford Small and Fidelity International
Assuming the 90 days horizon Hartford Small Cap is expected to generate 1.43 times more return on investment than Fidelity International. However, Hartford Small is 1.43 times more volatile than Fidelity International Growth. It trades about 0.07 of its potential returns per unit of risk. Fidelity International Growth is currently generating about 0.05 per unit of risk. If you would invest 2,412 in Hartford Small Cap on August 31, 2024 and sell it today you would earn a total of 736.00 from holding Hartford Small Cap or generate 30.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Hartford Small Cap vs. Fidelity International Growth
Performance |
| Timeline |
| Hartford Small Cap |
| Fidelity International |
Hartford Small and Fidelity International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Small and Fidelity International
The main advantage of trading using opposite Hartford Small and Fidelity International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Small position performs unexpectedly, Fidelity International 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 Fidelity International will offset losses from the drop in Fidelity International's long position.| Hartford Small vs. The Hartford Midcap | Hartford Small vs. Mfs Emerging Markets | Hartford Small vs. Wells Fargo Special | Hartford Small vs. Baron Emerging Markets |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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