Correlation Between The Hartford and Wilmington Municipal
Can any of the company-specific risk be diversified away by investing in both The Hartford and Wilmington Municipal 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 Wilmington Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Emerging and Wilmington Municipal Bond, you can compare the effects of market volatilities on The Hartford and Wilmington Municipal 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 Wilmington Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and Wilmington Municipal.
Diversification Opportunities for The Hartford and Wilmington Municipal
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between The and Wilmington is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Emerging and Wilmington Municipal Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Municipal Bond 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 Emerging are associated (or correlated) with Wilmington Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Municipal Bond has no effect on the direction of The Hartford i.e., The Hartford and Wilmington Municipal go up and down completely randomly.
Pair Corralation between The Hartford and Wilmington Municipal
Assuming the 90 days horizon The Hartford Emerging is expected to generate 2.31 times more return on investment than Wilmington Municipal. However, The Hartford is 2.31 times more volatile than Wilmington Municipal Bond. It trades about 0.03 of its potential returns per unit of risk. Wilmington Municipal Bond is currently generating about 0.05 per unit of risk. If you would invest 440.00 in The Hartford Emerging on August 29, 2024 and sell it today you would earn a total of 19.00 from holding The Hartford Emerging or generate 4.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Emerging vs. Wilmington Municipal Bond
Performance |
| Timeline |
| Hartford Emerging |
| Wilmington Municipal Bond |
The Hartford and Wilmington Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and Wilmington Municipal
The main advantage of trading using opposite The Hartford and Wilmington Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford position performs unexpectedly, Wilmington Municipal 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 Wilmington Municipal will offset losses from the drop in Wilmington Municipal's long position.| The Hartford vs. Short Duration Inflation | The Hartford vs. Lord Abbett Inflation | The Hartford vs. Federated Hermes Inflation | The Hartford vs. Ab Municipal Bond |
| Wilmington Municipal vs. Wilmington Global Alpha | Wilmington Municipal vs. Wilmington Global Alpha | Wilmington Municipal vs. Wilmington Broad Market | Wilmington Municipal vs. Wilmington Municipal Bond |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |