Correlation Between Vanguard Inflation-protec and Hartford Inflation
Can any of the company-specific risk be diversified away by investing in both Vanguard Inflation-protec and Hartford Inflation 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 Vanguard Inflation-protec and Hartford Inflation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Inflation Protected Securities and The Hartford Inflation, you can compare the effects of market volatilities on Vanguard Inflation-protec and Hartford Inflation 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 Vanguard Inflation-protec with a short position of Hartford Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Inflation-protec and Hartford Inflation.
Diversification Opportunities for Vanguard Inflation-protec and Hartford Inflation
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Vanguard and Hartford is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Inflation Protected S and The Hartford Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hartford Inflation and Vanguard Inflation-protec 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 Vanguard Inflation Protected Securities are associated (or correlated) with Hartford Inflation. 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 Inflation has no effect on the direction of Vanguard Inflation-protec i.e., Vanguard Inflation-protec and Hartford Inflation go up and down completely randomly.
Pair Corralation between Vanguard Inflation-protec and Hartford Inflation
If you would invest 1,142 in Vanguard Inflation Protected Securities on September 3, 2024 and sell it today you would earn a total of 44.00 from holding Vanguard Inflation Protected Securities or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.44% |
| Values | Daily Returns |
Vanguard Inflation Protected S vs. The Hartford Inflation
Performance |
| Timeline |
| Vanguard Inflation-protec |
| The Hartford Inflation |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Vanguard Inflation-protec and Hartford Inflation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Inflation-protec and Hartford Inflation
The main advantage of trading using opposite Vanguard Inflation-protec and Hartford Inflation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Inflation-protec position performs unexpectedly, Hartford Inflation 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 Inflation will offset losses from the drop in Hartford Inflation's long position.The idea behind Vanguard Inflation Protected Securities and The Hartford Inflation pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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