Correlation Between Arrow Managed and Hartford Healthcare
Can any of the company-specific risk be diversified away by investing in both Arrow Managed 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 Arrow Managed and Hartford Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arrow Managed Futures and Hartford Healthcare Hls, you can compare the effects of market volatilities on Arrow Managed 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 Arrow Managed with a short position of Hartford Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrow Managed and Hartford Healthcare.
Diversification Opportunities for Arrow Managed and Hartford Healthcare
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Arrow and HARTFORD is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Arrow Managed Futures 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 Arrow Managed 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 Arrow Managed Futures 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 Arrow Managed i.e., Arrow Managed and Hartford Healthcare go up and down completely randomly.
Pair Corralation between Arrow Managed and Hartford Healthcare
Assuming the 90 days horizon Arrow Managed Futures is expected to generate 1.35 times more return on investment than Hartford Healthcare. However, Arrow Managed is 1.35 times more volatile than Hartford Healthcare Hls. It trades about 0.07 of its potential returns per unit of risk. Hartford Healthcare Hls is currently generating about -0.08 per unit of risk. If you would invest 553.00 in Arrow Managed Futures on October 26, 2024 and sell it today you would earn a total of 27.00 from holding Arrow Managed Futures or generate 4.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arrow Managed Futures vs. Hartford Healthcare Hls
Performance |
| Timeline |
| Arrow Managed Futures |
| Hartford Healthcare Hls |
Arrow Managed and Hartford Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arrow Managed and Hartford Healthcare
The main advantage of trading using opposite Arrow Managed and Hartford Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrow Managed 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.| Arrow Managed vs. Intermediate Government Bond | Arrow Managed vs. Short Term Government Fund | Arrow Managed vs. Sit Government Securities | Arrow Managed vs. Dws Government Money |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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