Correlation Between Hartford Small and Oakmark Select
Can any of the company-specific risk be diversified away by investing in both Hartford Small and Oakmark Select 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 Oakmark Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Small and Oakmark Select, you can compare the effects of market volatilities on Hartford Small and Oakmark Select 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 Oakmark Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Small and Oakmark Select.
Diversification Opportunities for Hartford Small and Oakmark Select
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hartford and Oakmark is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Small and Oakmark Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark Select 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 The Hartford Small are associated (or correlated) with Oakmark Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark Select has no effect on the direction of Hartford Small i.e., Hartford Small and Oakmark Select go up and down completely randomly.
Pair Corralation between Hartford Small and Oakmark Select
Assuming the 90 days horizon The Hartford Small is expected to under-perform the Oakmark Select. In addition to that, Hartford Small is 1.76 times more volatile than Oakmark Select. It trades about -0.02 of its total potential returns per unit of risk. Oakmark Select is currently generating about 0.0 per unit of volatility. If you would invest 8,347 in Oakmark Select on September 12, 2024 and sell it today you would earn a total of 1.00 from holding Oakmark Select or generate 0.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
The Hartford Small vs. Oakmark Select
Performance |
| Timeline |
| Hartford Small |
| Oakmark Select |
Hartford Small and Oakmark Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Small and Oakmark Select
The main advantage of trading using opposite Hartford Small and Oakmark Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Small position performs unexpectedly, Oakmark Select 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 Oakmark Select will offset losses from the drop in Oakmark Select's long position.| Hartford Small vs. Fidelity Small Cap | Hartford Small vs. Heartland Value Plus | Hartford Small vs. Amg River Road | Hartford Small vs. Lsv Small Cap |
| Oakmark Select vs. Transamerica Financial Life | Oakmark Select vs. Davis Financial Fund | Oakmark Select vs. Financials Ultrasector Profund | Oakmark Select vs. Vanguard Financials Index |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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