Correlation Between Hartford Municipal and IQ MacKay
Can any of the company-specific risk be diversified away by investing in both Hartford Municipal and IQ MacKay 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 Municipal and IQ MacKay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Municipal Opportunities and IQ MacKay Municipal, you can compare the effects of market volatilities on Hartford Municipal and IQ MacKay 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 Municipal with a short position of IQ MacKay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Municipal and IQ MacKay.
Diversification Opportunities for Hartford Municipal and IQ MacKay
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hartford and MMIN is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Municipal Opportuniti and IQ MacKay Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQ MacKay Municipal and Hartford Municipal 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 Municipal Opportunities are associated (or correlated) with IQ MacKay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQ MacKay Municipal has no effect on the direction of Hartford Municipal i.e., Hartford Municipal and IQ MacKay go up and down completely randomly.
Pair Corralation between Hartford Municipal and IQ MacKay
Given the investment horizon of 90 days Hartford Municipal Opportunities is expected to generate 0.74 times more return on investment than IQ MacKay. However, Hartford Municipal Opportunities is 1.35 times less risky than IQ MacKay. It trades about 0.03 of its potential returns per unit of risk. IQ MacKay Municipal is currently generating about 0.0 per unit of risk. If you would invest 3,829 in Hartford Municipal Opportunities on October 26, 2024 and sell it today you would earn a total of 36.00 from holding Hartford Municipal Opportunities or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hartford Municipal Opportuniti vs. IQ MacKay Municipal
Performance |
| Timeline |
| Hartford Municipal |
| IQ MacKay Municipal |
Hartford Municipal and IQ MacKay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Municipal and IQ MacKay
The main advantage of trading using opposite Hartford Municipal and IQ MacKay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Municipal position performs unexpectedly, IQ MacKay 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 IQ MacKay will offset losses from the drop in IQ MacKay's long position.| Hartford Municipal vs. IQ MacKay Municipal | Hartford Municipal vs. IQ MacKay Municipal | Hartford Municipal vs. Franklin Liberty Federal | Hartford Municipal vs. Franklin Liberty Intermediate |
| IQ MacKay vs. IQ MacKay Municipal | IQ MacKay vs. Franklin Liberty Federal | IQ MacKay vs. Columbia Multi Sector Municipal | IQ MacKay vs. Hartford Municipal Opportunities |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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