Correlation Between Touchstone Small and Hartford Growth
Can any of the company-specific risk be diversified away by investing in both Touchstone Small and Hartford Growth 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 Small and Hartford Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Small Cap and The Hartford Growth, you can compare the effects of market volatilities on Touchstone Small and Hartford Growth 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 Small with a short position of Hartford Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Small and Hartford Growth.
Diversification Opportunities for Touchstone Small and Hartford Growth
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Touchstone and Hartford is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Small Cap and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth and Touchstone Small 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 Small Cap are associated (or correlated) with Hartford Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Growth has no effect on the direction of Touchstone Small i.e., Touchstone Small and Hartford Growth go up and down completely randomly.
Pair Corralation between Touchstone Small and Hartford Growth
Assuming the 90 days horizon Touchstone Small Cap is expected to generate 0.8 times more return on investment than Hartford Growth. However, Touchstone Small Cap is 1.25 times less risky than Hartford Growth. It trades about 0.29 of its potential returns per unit of risk. The Hartford Growth is currently generating about 0.02 per unit of risk. If you would invest 3,819 in Touchstone Small Cap on October 24, 2024 and sell it today you would earn a total of 190.00 from holding Touchstone Small Cap or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone Small Cap vs. The Hartford Growth
Performance |
| Timeline |
| Touchstone Small Cap |
| Hartford Growth |
Touchstone Small and Hartford Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Small and Hartford Growth
The main advantage of trading using opposite Touchstone Small and Hartford Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Small position performs unexpectedly, Hartford Growth 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 Growth will offset losses from the drop in Hartford Growth's long position.| Touchstone Small vs. Touchstone Sands Capital | Touchstone Small vs. Mid Cap Growth | Touchstone Small vs. Mid Cap Growth | Touchstone Small vs. Mid Cap Growth |
| Hartford Growth vs. Asg Managed Futures | Hartford Growth vs. Guggenheim Managed Futures | Hartford Growth vs. Lord Abbett Inflation | Hartford Growth vs. Great West Inflation Protected Securities |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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