Correlation Between Carillon Scout and Hartford Schroders

Can any of the company-specific risk be diversified away by investing in both Carillon Scout and Hartford Schroders 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 Carillon Scout and Hartford Schroders into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Carillon Scout Mid and Hartford Schroders Emerging, you can compare the effects of market volatilities on Carillon Scout and Hartford Schroders 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 Carillon Scout with a short position of Hartford Schroders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carillon Scout and Hartford Schroders.

Diversification Opportunities for Carillon Scout and Hartford Schroders

0.13

Correlation Coefficient

Carillon Scout  Hartford Schroders

Average diversification

The 3 months correlation between Carillon and Hartford is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Carillon Scout Mid and Hartford Schroders Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Schroders and Carillon Scout 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 Carillon Scout Mid are associated (or correlated) with Hartford Schroders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Schroders has no effect on the direction of Carillon Scout i.e., Carillon Scout and Hartford Schroders go up and down completely randomly.

Pair Corralation between Carillon Scout and Hartford Schroders

Assuming the 90 days horizon Carillon Scout Mid is expected to under-perform the Hartford Schroders. In addition to that, Carillon Scout is 2.4 times more volatile than Hartford Schroders Emerging. It trades about -0.14 of its total potential returns per unit of risk. Hartford Schroders Emerging is currently generating about -0.02 per unit of volatility. If you would invest  1,697  in Hartford Schroders Emerging on December 2, 2024 and sell it today you would lose (17.00) from holding Hartford Schroders Emerging or give up 1.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Carillon Scout Mid  vs.  Hartford Schroders Emerging

Carillon Scout Mid

Risk-Adjusted Performance

Very Weak

Over the last 90 days Carillon Scout Mid has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Hartford Schroders

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hartford Schroders Emerging has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Hartford Schroders is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Carillon Scout and Hartford Schroders

The main advantage of trading using opposite Carillon Scout and Hartford Schroders positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carillon Scout position performs unexpectedly, Hartford Schroders 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 Schroders will offset losses from the drop in Hartford Schroders' long position.

The idea behind Carillon Scout Mid and Hartford Schroders Emerging 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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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.