Correlation Between 6 Meridian and Hartford Multifactor
Can any of the company-specific risk be diversified away by investing in both 6 Meridian 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 6 Meridian and Hartford Multifactor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 6 Meridian Small and Hartford Multifactor Small, you can compare the effects of market volatilities on 6 Meridian 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 6 Meridian with a short position of Hartford Multifactor. Check out your portfolio center. Please also check ongoing floating volatility patterns of 6 Meridian and Hartford Multifactor.
Diversification Opportunities for 6 Meridian and Hartford Multifactor
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SIXS and Hartford is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding 6 Meridian Small and Hartford Multifactor Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Multifactor and 6 Meridian 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 6 Meridian Small 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 6 Meridian i.e., 6 Meridian and Hartford Multifactor go up and down completely randomly.
Pair Corralation between 6 Meridian and Hartford Multifactor
Given the investment horizon of 90 days 6 Meridian Small is expected to generate 1.0 times more return on investment than Hartford Multifactor. However, 6 Meridian Small is 1.0 times less risky than Hartford Multifactor. It trades about 0.15 of its potential returns per unit of risk. Hartford Multifactor Small is currently generating about 0.07 per unit of risk. If you would invest 4,923 in 6 Meridian Small on October 20, 2024 and sell it today you would earn a total of 131.00 from holding 6 Meridian Small or generate 2.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
6 Meridian Small vs. Hartford Multifactor Small
Performance |
| Timeline |
| 6 Meridian Small |
| Hartford Multifactor |
6 Meridian and Hartford Multifactor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 6 Meridian and Hartford Multifactor
The main advantage of trading using opposite 6 Meridian and Hartford Multifactor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 6 Meridian 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.| 6 Meridian vs. 6 Meridian Mega | 6 Meridian vs. 6 Meridian Low | 6 Meridian vs. ETC 6 Meridian | 6 Meridian 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |