Correlation Between Ab Small and Hartford Growth
Can any of the company-specific risk be diversified away by investing in both Ab Small 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 Ab Small and Hartford Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Small Cap and The Hartford Growth, you can compare the effects of market volatilities on Ab Small 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 Ab Small with a short position of Hartford Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Small and Hartford Growth.
Diversification Opportunities for Ab Small and Hartford Growth
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SCYVX and Hartford is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Ab Small Cap and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth and Ab 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 Ab Small Cap 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 Ab Small i.e., Ab Small and Hartford Growth go up and down completely randomly.
Pair Corralation between Ab Small and Hartford Growth
Assuming the 90 days horizon Ab Small is expected to generate 1.57 times less return on investment than Hartford Growth. In addition to that, Ab Small is 2.0 times more volatile than The Hartford Growth. It trades about 0.06 of its total potential returns per unit of risk. The Hartford Growth is currently generating about 0.2 per unit of volatility. If you would invest 1,527 in The Hartford Growth on September 13, 2024 and sell it today you would earn a total of 25.00 from holding The Hartford Growth or generate 1.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Small Cap vs. The Hartford Growth
Performance |
| Timeline |
| Ab Small Cap |
| Hartford Growth |
Ab Small and Hartford Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Small and Hartford Growth
The main advantage of trading using opposite Ab Small and Hartford Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Small 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.| Ab Small vs. American Century Etf | Ab Small vs. Valic Company I | Ab Small vs. Northern Small Cap | Ab Small vs. Small Cap Value Fund |
| Hartford Growth vs. Alpsalerian Energy Infrastructure | Hartford Growth vs. Calvert Global Energy | Hartford Growth vs. Gmo Resources | Hartford Growth vs. Gamco Natural Resources |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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