Correlation Between Siit Emerging and Hartford Municipal
Can any of the company-specific risk be diversified away by investing in both Siit Emerging and Hartford Municipal 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 Siit Emerging and Hartford Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit Emerging Markets and The Hartford Municipal, you can compare the effects of market volatilities on Siit Emerging and Hartford Municipal 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 Siit Emerging with a short position of Hartford Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit Emerging and Hartford Municipal.
Diversification Opportunities for Siit Emerging and Hartford Municipal
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Siit and Hartford is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Siit Emerging Markets and The Hartford Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hartford Municipal and Siit Emerging 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 Siit Emerging Markets are associated (or correlated) with Hartford Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hartford Municipal has no effect on the direction of Siit Emerging i.e., Siit Emerging and Hartford Municipal go up and down completely randomly.
Pair Corralation between Siit Emerging and Hartford Municipal
Assuming the 90 days horizon Siit Emerging Markets is expected to generate 3.87 times more return on investment than Hartford Municipal. However, Siit Emerging is 3.87 times more volatile than The Hartford Municipal. It trades about 0.06 of its potential returns per unit of risk. The Hartford Municipal is currently generating about 0.09 per unit of risk. If you would invest 801.00 in Siit Emerging Markets on September 2, 2024 and sell it today you would earn a total of 193.00 from holding Siit Emerging Markets or generate 24.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siit Emerging Markets vs. The Hartford Municipal
Performance |
| Timeline |
| Siit Emerging Markets |
| The Hartford Municipal |
Siit Emerging and Hartford Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit Emerging and Hartford Municipal
The main advantage of trading using opposite Siit Emerging and Hartford Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit Emerging position performs unexpectedly, Hartford Municipal 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 Municipal will offset losses from the drop in Hartford Municipal's long position.| Siit Emerging vs. Saat Market Growth | Siit Emerging vs. Simt Real Return | Siit Emerging vs. Simt Small Cap | Siit Emerging vs. Siit Screened World |
| Hartford Municipal vs. The Hartford Growth | Hartford Municipal vs. The Hartford Growth | Hartford Municipal vs. The Hartford Growth | Hartford Municipal 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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