Correlation Between Lsv Small and Hartford Healthcare
Can any of the company-specific risk be diversified away by investing in both Lsv Small and Hartford Healthcare 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 Lsv Small and Hartford Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lsv Small Cap and Hartford Healthcare Hls, you can compare the effects of market volatilities on Lsv Small and Hartford Healthcare 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 Lsv Small with a short position of Hartford Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lsv Small and Hartford Healthcare.
Diversification Opportunities for Lsv Small and Hartford Healthcare
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lsv and Hartford is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Lsv Small Cap and Hartford Healthcare Hls in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Healthcare Hls and Lsv 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 Lsv Small Cap are associated (or correlated) with Hartford Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Healthcare Hls has no effect on the direction of Lsv Small i.e., Lsv Small and Hartford Healthcare go up and down completely randomly.
Pair Corralation between Lsv Small and Hartford Healthcare
Assuming the 90 days horizon Lsv Small Cap is expected to generate 1.58 times more return on investment than Hartford Healthcare. However, Lsv Small is 1.58 times more volatile than Hartford Healthcare Hls. It trades about 0.03 of its potential returns per unit of risk. Hartford Healthcare Hls is currently generating about 0.01 per unit of risk. If you would invest 1,655 in Lsv Small Cap on October 16, 2024 and sell it today you would earn a total of 211.00 from holding Lsv Small Cap or generate 12.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lsv Small Cap vs. Hartford Healthcare Hls
Performance |
| Timeline |
| Lsv Small Cap |
| Hartford Healthcare Hls |
Lsv Small and Hartford Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lsv Small and Hartford Healthcare
The main advantage of trading using opposite Lsv Small and Hartford Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lsv Small position performs unexpectedly, Hartford Healthcare 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 Hartford Healthcare will offset losses from the drop in Hartford Healthcare's long position.| Lsv Small vs. Amg Timessquare Mid | Lsv Small vs. Lsv Value Equity | Lsv Small vs. Baron Discovery Fund | Lsv Small vs. Victory Sycamore Established |
| Hartford Healthcare vs. Ultramid Cap Profund Ultramid Cap | Hartford Healthcare vs. Lsv Small Cap | Hartford Healthcare vs. Queens Road Small | Hartford Healthcare vs. Ultrasmall Cap Profund Ultrasmall 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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