Correlation Between Hartford Healthcare and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Hartford Healthcare and Credit Suisse 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 Hartford Healthcare and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Healthcare Hls and Credit Suisse Modity, you can compare the effects of market volatilities on Hartford Healthcare and Credit Suisse 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 Hartford Healthcare with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Healthcare and Credit Suisse.
Diversification Opportunities for Hartford Healthcare and Credit Suisse
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hartford and Credit is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Healthcare Hls and Credit Suisse Modity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Modity and Hartford Healthcare 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 Hartford Healthcare Hls are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Modity has no effect on the direction of Hartford Healthcare i.e., Hartford Healthcare and Credit Suisse go up and down completely randomly.
Pair Corralation between Hartford Healthcare and Credit Suisse
Assuming the 90 days horizon Hartford Healthcare is expected to generate 6.3 times less return on investment than Credit Suisse. In addition to that, Hartford Healthcare is 1.28 times more volatile than Credit Suisse Modity. It trades about 0.02 of its total potential returns per unit of risk. Credit Suisse Modity is currently generating about 0.18 per unit of volatility. If you would invest 2,166 in Credit Suisse Modity on December 29, 2024 and sell it today you would earn a total of 170.00 from holding Credit Suisse Modity or generate 7.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.39% |
Values | Daily Returns |
Hartford Healthcare Hls vs. Credit Suisse Modity
Performance |
Timeline |
Hartford Healthcare Hls |
Credit Suisse Modity |
Hartford Healthcare and Credit Suisse Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hartford Healthcare and Credit Suisse
The main advantage of trading using opposite Hartford Healthcare and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Healthcare position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.The idea behind Hartford Healthcare Hls and Credit Suisse Modity 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.
Credit Suisse vs. Fidelity Advisor Diversified | Credit Suisse vs. Guidepath Conservative Income | Credit Suisse vs. Delaware Limited Term Diversified | Credit Suisse vs. Timothy Plan Conservative |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Money Managers Screen money managers from public funds and ETFs managed around the world | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation |