Correlation Between Growth Opportunities and The Hartford
Can any of the company-specific risk be diversified away by investing in both Growth Opportunities and The Hartford 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 Growth Opportunities and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Opportunities Fund and The Hartford Municipal, you can compare the effects of market volatilities on Growth Opportunities and The Hartford 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 Growth Opportunities with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Opportunities and The Hartford.
Diversification Opportunities for Growth Opportunities and The Hartford
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Growth and The is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Growth Opportunities Fund 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 Growth Opportunities 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 Growth Opportunities Fund are associated (or correlated) with The Hartford. 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 Growth Opportunities i.e., Growth Opportunities and The Hartford go up and down completely randomly.
Pair Corralation between Growth Opportunities and The Hartford
Assuming the 90 days horizon Growth Opportunities Fund is expected to generate 5.26 times more return on investment than The Hartford. However, Growth Opportunities is 5.26 times more volatile than The Hartford Municipal. It trades about 0.12 of its potential returns per unit of risk. The Hartford Municipal is currently generating about 0.08 per unit of risk. If you would invest 3,324 in Growth Opportunities Fund on September 3, 2024 and sell it today you would earn a total of 2,532 from holding Growth Opportunities Fund or generate 76.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Opportunities Fund vs. The Hartford Municipal
Performance |
| Timeline |
| Growth Opportunities |
| The Hartford Municipal |
Growth Opportunities and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Opportunities and The Hartford
The main advantage of trading using opposite Growth Opportunities and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Opportunities position performs unexpectedly, The Hartford 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 The Hartford will offset losses from the drop in The Hartford's long position.| Growth Opportunities vs. Victory Rs Partners | Growth Opportunities vs. Lord Abbett Small | Growth Opportunities vs. Hennessy Nerstone Mid | Growth Opportunities vs. Fpa Queens Road |
| The Hartford vs. Ambrus Core Bond | The Hartford vs. Dreyfusstandish Global Fixed | The Hartford vs. Maryland Tax Free Bond | The Hartford vs. Blrc Sgy Mnp |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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