Correlation Between The Hartford and Steward International
Can any of the company-specific risk be diversified away by investing in both The Hartford and Steward 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 The Hartford and Steward International 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 Steward International Enhanced, you can compare the effects of market volatilities on The Hartford and Steward 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 The Hartford with a short position of Steward International. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and Steward International.
Diversification Opportunities for The Hartford and Steward International
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between The and Steward is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Small and Steward International Enhanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steward International 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 Small are associated (or correlated) with Steward International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steward International has no effect on the direction of The Hartford i.e., The Hartford and Steward International go up and down completely randomly.
Pair Corralation between The Hartford and Steward International
Assuming the 90 days horizon The Hartford Small is expected to generate 1.3 times more return on investment than Steward International. However, The Hartford is 1.3 times more volatile than Steward International Enhanced. It trades about 0.06 of its potential returns per unit of risk. Steward International Enhanced is currently generating about 0.07 per unit of risk. If you would invest 2,270 in The Hartford Small on September 5, 2024 and sell it today you would earn a total of 876.00 from holding The Hartford Small or generate 38.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
The Hartford Small vs. Steward International Enhanced
Performance |
| Timeline |
| Hartford Small |
| Steward International |
The Hartford and Steward International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and Steward International
The main advantage of trading using opposite The Hartford and Steward International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford position performs unexpectedly, Steward 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 Steward International will offset losses from the drop in Steward International's long position.| The Hartford vs. Dreyfusstandish Global Fixed | The Hartford vs. Alliancebernstein Global High | The Hartford vs. Morningstar Global Income | The Hartford vs. Ab Global Real |
| Steward International vs. Small Midcap Dividend Income | Steward International vs. The Hartford Small | Steward International vs. Touchstone Small Cap | Steward International vs. Ab Small Cap |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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