Correlation Between Hartford Multifactor and Syntax
Can any of the company-specific risk be diversified away by investing in both Hartford Multifactor and Syntax 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 Multifactor and Syntax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Multifactor Small and Syntax, you can compare the effects of market volatilities on Hartford Multifactor and Syntax 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 Multifactor with a short position of Syntax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Multifactor and Syntax.
Diversification Opportunities for Hartford Multifactor and Syntax
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hartford and Syntax is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Multifactor Small and Syntax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Syntax and Hartford Multifactor 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 Hartford Multifactor Small are associated (or correlated) with Syntax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Syntax has no effect on the direction of Hartford Multifactor i.e., Hartford Multifactor and Syntax go up and down completely randomly.
Pair Corralation between Hartford Multifactor and Syntax
Given the investment horizon of 90 days Hartford Multifactor Small is expected to generate 0.93 times more return on investment than Syntax. However, Hartford Multifactor Small is 1.08 times less risky than Syntax. It trades about 0.06 of its potential returns per unit of risk. Syntax is currently generating about 0.03 per unit of risk. If you would invest 3,464 in Hartford Multifactor Small on September 16, 2024 and sell it today you would earn a total of 1,184 from holding Hartford Multifactor Small or generate 34.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 89.11% |
| Values | Daily Returns |
Hartford Multifactor Small vs. Syntax
Performance |
| Timeline |
| Hartford Multifactor |
| Syntax |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Hartford Multifactor and Syntax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Multifactor and Syntax
The main advantage of trading using opposite Hartford Multifactor and Syntax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Multifactor position performs unexpectedly, Syntax 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 Syntax will offset losses from the drop in Syntax's long position.The idea behind Hartford Multifactor Small and Syntax pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Syntax vs. Exchange Listed Funds | Syntax vs. 6 Meridian Small | Syntax vs. Hartford Multifactor Small | Syntax vs. Two Roads Shared |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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