Correlation Between Touchstone Value and The Hartford
Can any of the company-specific risk be diversified away by investing in both Touchstone Value 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 Touchstone Value and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Value Fund and The Hartford Floating, you can compare the effects of market volatilities on Touchstone Value 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 Touchstone Value with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Value and The Hartford.
Diversification Opportunities for Touchstone Value and The Hartford
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Touchstone and The is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Value Fund and The Hartford Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Floating and Touchstone Value 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 Touchstone Value 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 Hartford Floating has no effect on the direction of Touchstone Value i.e., Touchstone Value and The Hartford go up and down completely randomly.
Pair Corralation between Touchstone Value and The Hartford
Assuming the 90 days horizon Touchstone Value Fund is expected to generate 10.74 times more return on investment than The Hartford. However, Touchstone Value is 10.74 times more volatile than The Hartford Floating. It trades about 0.31 of its potential returns per unit of risk. The Hartford Floating is currently generating about 0.18 per unit of risk. If you would invest 1,281 in Touchstone Value Fund on September 1, 2024 and sell it today you would earn a total of 65.00 from holding Touchstone Value Fund or generate 5.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 95.45% |
Values | Daily Returns |
Touchstone Value Fund vs. The Hartford Floating
Performance |
Timeline |
Touchstone Value |
Hartford Floating |
Touchstone Value and The Hartford Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Touchstone Value and The Hartford
The main advantage of trading using opposite Touchstone Value and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Value 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.Touchstone Value vs. Tfa Alphagen Growth | Touchstone Value vs. Chase Growth Fund | Touchstone Value vs. Kinetics Small Cap | Touchstone Value vs. L Abbett Growth |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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