Correlation Between Western Asset and Hartford Checks
Can any of the company-specific risk be diversified away by investing in both Western Asset and Hartford Checks 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 Western Asset and Hartford Checks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Diversified and The Hartford Checks, you can compare the effects of market volatilities on Western Asset and Hartford Checks 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 Western Asset with a short position of Hartford Checks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Hartford Checks.
Diversification Opportunities for Western Asset and Hartford Checks
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Hartford is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Diversified and The Hartford Checks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Checks and Western Asset 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 Western Asset Diversified are associated (or correlated) with Hartford Checks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Checks has no effect on the direction of Western Asset i.e., Western Asset and Hartford Checks go up and down completely randomly.
Pair Corralation between Western Asset and Hartford Checks
Assuming the 90 days horizon Western Asset Diversified is expected to generate 0.84 times more return on investment than Hartford Checks. However, Western Asset Diversified is 1.19 times less risky than Hartford Checks. It trades about 0.11 of its potential returns per unit of risk. The Hartford Checks is currently generating about 0.09 per unit of risk. If you would invest 1,545 in Western Asset Diversified on September 13, 2024 and sell it today you would earn a total of 9.00 from holding Western Asset Diversified or generate 0.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Diversified vs. The Hartford Checks
Performance |
| Timeline |
| Western Asset Diversified |
| Hartford Checks |
Western Asset and Hartford Checks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Hartford Checks
The main advantage of trading using opposite Western Asset and Hartford Checks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Hartford Checks 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 Checks will offset losses from the drop in Hartford Checks' long position.| Western Asset vs. Vanguard Total Stock | Western Asset vs. Vanguard 500 Index | Western Asset vs. Vanguard Total Stock | Western Asset vs. Vanguard Total Stock |
| Hartford Checks vs. The Hartford Growth | Hartford Checks vs. The Hartford Growth | Hartford Checks vs. The Hartford Growth | Hartford Checks 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Transaction History View history of all your transactions and understand their impact on performance |