Correlation Between Tekla Healthcare and Hartford Healthcare
Can any of the company-specific risk be diversified away by investing in both Tekla Healthcare and Hartford Healthcare 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 Tekla Healthcare and Hartford Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tekla Healthcare Opportunities and Hartford Healthcare Hls, you can compare the effects of market volatilities on Tekla Healthcare and Hartford Healthcare 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 Tekla Healthcare with a short position of Hartford Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Hartford Healthcare.
Diversification Opportunities for Tekla Healthcare and Hartford Healthcare
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tekla and HARTFORD is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Opportunities and Hartford Healthcare Hls in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Healthcare Hls and Tekla Healthcare 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 Tekla Healthcare Opportunities are associated (or correlated) with Hartford Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Healthcare Hls has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Hartford Healthcare go up and down completely randomly.
Pair Corralation between Tekla Healthcare and Hartford Healthcare
Considering the 90-day investment horizon Tekla Healthcare Opportunities is expected to generate 1.24 times more return on investment than Hartford Healthcare. However, Tekla Healthcare is 1.24 times more volatile than Hartford Healthcare Hls. It trades about 0.11 of its potential returns per unit of risk. Hartford Healthcare Hls is currently generating about 0.06 per unit of risk. If you would invest 1,601 in Tekla Healthcare Opportunities on September 4, 2024 and sell it today you would earn a total of 471.00 from holding Tekla Healthcare Opportunities or generate 29.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Tekla Healthcare Opportunities vs. Hartford Healthcare Hls
Performance |
| Timeline |
| Tekla Healthcare Opp |
| Hartford Healthcare Hls |
Tekla Healthcare and Hartford Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tekla Healthcare and Hartford Healthcare
The main advantage of trading using opposite Tekla Healthcare and Hartford Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tekla Healthcare position performs unexpectedly, Hartford Healthcare 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 Healthcare will offset losses from the drop in Hartford Healthcare's long position.| Tekla Healthcare vs. Tekla Healthcare Investors | Tekla Healthcare vs. Tekla Life Sciences | Tekla Healthcare vs. Cohen Steers Reit | Tekla Healthcare vs. XAI Octagon Floating |
| Hartford Healthcare vs. The Hartford Growth | Hartford Healthcare vs. The Hartford Growth | Hartford Healthcare vs. The Hartford Growth | Hartford Healthcare 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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