Correlation Between Hartford Equity and Kinetics Paradigm
Can any of the company-specific risk be diversified away by investing in both Hartford Equity and Kinetics Paradigm 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 Equity and Kinetics Paradigm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Equity and Kinetics Paradigm Fund, you can compare the effects of market volatilities on Hartford Equity and Kinetics Paradigm 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 Equity with a short position of Kinetics Paradigm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Equity and Kinetics Paradigm.
Diversification Opportunities for Hartford Equity and Kinetics Paradigm
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hartford and Kinetics is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Equity and Kinetics Paradigm Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetics Paradigm and Hartford Equity 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 Equity are associated (or correlated) with Kinetics Paradigm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetics Paradigm has no effect on the direction of Hartford Equity i.e., Hartford Equity and Kinetics Paradigm go up and down completely randomly.
Pair Corralation between Hartford Equity and Kinetics Paradigm
Assuming the 90 days horizon The Hartford Equity is expected to generate 0.12 times more return on investment than Kinetics Paradigm. However, The Hartford Equity is 8.19 times less risky than Kinetics Paradigm. It trades about -0.17 of its potential returns per unit of risk. Kinetics Paradigm Fund is currently generating about -0.04 per unit of risk. If you would invest 2,279 in The Hartford Equity on September 12, 2024 and sell it today you would lose (39.00) from holding The Hartford Equity or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Equity vs. Kinetics Paradigm Fund
Performance |
| Timeline |
| Hartford Equity |
| Kinetics Paradigm |
Hartford Equity and Kinetics Paradigm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Equity and Kinetics Paradigm
The main advantage of trading using opposite Hartford Equity and Kinetics Paradigm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Equity position performs unexpectedly, Kinetics Paradigm 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 Kinetics Paradigm will offset losses from the drop in Kinetics Paradigm's long position.| Hartford Equity vs. The Hartford Dividend | Hartford Equity vs. The Hartford Total | Hartford Equity vs. The Hartford International | Hartford Equity vs. The Hartford Midcap |
| Kinetics Paradigm vs. Massmutual Premier Diversified | Kinetics Paradigm vs. Small Cap Stock | Kinetics Paradigm vs. Jhancock Diversified Macro | Kinetics Paradigm vs. Western Asset Diversified |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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