Correlation Between SCOR PK and Hartford Multifactor
Can any of the company-specific risk be diversified away by investing in both SCOR PK and Hartford Multifactor 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 SCOR PK and Hartford Multifactor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR PK and Hartford Multifactor Emerging, you can compare the effects of market volatilities on SCOR PK and Hartford Multifactor 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 SCOR PK with a short position of Hartford Multifactor. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR PK and Hartford Multifactor.
Diversification Opportunities for SCOR PK and Hartford Multifactor
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SCOR and Hartford is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding SCOR PK and Hartford Multifactor Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Multifactor and SCOR PK 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 SCOR PK are associated (or correlated) with Hartford Multifactor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Multifactor has no effect on the direction of SCOR PK i.e., SCOR PK and Hartford Multifactor go up and down completely randomly.
Pair Corralation between SCOR PK and Hartford Multifactor
Assuming the 90 days horizon SCOR PK is expected to generate 4.16 times more return on investment than Hartford Multifactor. However, SCOR PK is 4.16 times more volatile than Hartford Multifactor Emerging. It trades about 0.17 of its potential returns per unit of risk. Hartford Multifactor Emerging is currently generating about -0.26 per unit of risk. If you would invest 221.00 in SCOR PK on August 29, 2024 and sell it today you would earn a total of 25.00 from holding SCOR PK or generate 11.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
SCOR PK vs. Hartford Multifactor Emerging
Performance |
| Timeline |
| SCOR PK |
| Hartford Multifactor |
SCOR PK and Hartford Multifactor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR PK and Hartford Multifactor
The main advantage of trading using opposite SCOR PK and Hartford Multifactor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR PK position performs unexpectedly, Hartford Multifactor 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 Multifactor will offset losses from the drop in Hartford Multifactor's long position.The idea behind SCOR PK and Hartford Multifactor Emerging 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.| Hartford Multifactor vs. ABIVAX Socit Anonyme | Hartford Multifactor vs. HUMANA INC | Hartford Multifactor vs. SCOR PK | Hartford Multifactor vs. Aquagold International |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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