Correlation Between NYSE Composite and Hartford Growth
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Hartford Growth 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 NYSE Composite and Hartford Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and The Hartford Growth, you can compare the effects of market volatilities on NYSE Composite and Hartford Growth 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 NYSE Composite with a short position of Hartford Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Hartford Growth.
Diversification Opportunities for NYSE Composite and Hartford Growth
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NYSE and Hartford is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth and NYSE Composite 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 NYSE Composite are associated (or correlated) with Hartford Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Growth has no effect on the direction of NYSE Composite i.e., NYSE Composite and Hartford Growth go up and down completely randomly.
Pair Corralation between NYSE Composite and Hartford Growth
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.16 times more return on investment than Hartford Growth. However, NYSE Composite is 1.16 times more volatile than The Hartford Growth. It trades about 0.38 of its potential returns per unit of risk. The Hartford Growth is currently generating about 0.36 per unit of risk. If you would invest 1,924,339 in NYSE Composite on September 4, 2024 and sell it today you would earn a total of 96,983 from holding NYSE Composite or generate 5.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. The Hartford Growth
Performance |
| Timeline |
NYSE Composite and Hartford Growth Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
The Hartford Growth
Pair trading matchups for Hartford Growth
Pair Trading with NYSE Composite and Hartford Growth
The main advantage of trading using opposite NYSE Composite and Hartford Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Hartford Growth 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 Growth will offset losses from the drop in Hartford Growth's long position.| NYSE Composite vs. Kite Realty Group | NYSE Composite vs. Tradeweb Markets | NYSE Composite vs. Meiwu Technology Co | NYSE Composite vs. Uber Technologies |
| Hartford Growth vs. The Hartford Growth | Hartford Growth vs. The Hartford Growth | Hartford Growth vs. The Hartford Growth | Hartford Growth vs. The Hartford Growth |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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