Correlation Between Vanguard Small-cap and The Hartford
Can any of the company-specific risk be diversified away by investing in both Vanguard Small-cap 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 Vanguard Small-cap and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Small Cap Value and The Hartford Midcap, you can compare the effects of market volatilities on Vanguard Small-cap 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 Vanguard Small-cap with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Small-cap and The Hartford.
Diversification Opportunities for Vanguard Small-cap and The Hartford
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vanguard and The is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Small Cap Value and The Hartford Midcap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Midcap and Vanguard Small-cap 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 Small Cap Value 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 Midcap has no effect on the direction of Vanguard Small-cap i.e., Vanguard Small-cap and The Hartford go up and down completely randomly.
Pair Corralation between Vanguard Small-cap and The Hartford
Assuming the 90 days horizon Vanguard Small Cap Value is expected to generate 1.03 times more return on investment than The Hartford. However, Vanguard Small-cap is 1.03 times more volatile than The Hartford Midcap. It trades about 0.06 of its potential returns per unit of risk. The Hartford Midcap is currently generating about 0.04 per unit of risk. If you would invest 3,780 in Vanguard Small Cap Value on September 3, 2024 and sell it today you would earn a total of 1,398 from holding Vanguard Small Cap Value or generate 36.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Small Cap Value vs. The Hartford Midcap
Performance |
| Timeline |
| Vanguard Small Cap |
| Hartford Midcap |
Vanguard Small-cap and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Small-cap and The Hartford
The main advantage of trading using opposite Vanguard Small-cap and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Small-cap 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.| Vanguard Small-cap vs. T Rowe Price | Vanguard Small-cap vs. Fm Investments Large | Vanguard Small-cap vs. Touchstone Large Cap | Vanguard Small-cap vs. Semiconductor Ultrasector Profund |
| The Hartford vs. Morgan Stanley Emerging | The Hartford vs. Ep Emerging Markets | The Hartford vs. The Hartford Emerging | The Hartford vs. Barings Emerging Markets |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |