Correlation Between Hartford Healthcare and Hartford Schroders

Can any of the company-specific risk be diversified away by investing in both Hartford Healthcare 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 Hartford Healthcare and Hartford Schroders 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 Hartford Schroders Sustainable, you can compare the effects of market volatilities on Hartford Healthcare 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 Hartford Healthcare with a short position of Hartford Schroders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Healthcare and Hartford Schroders.

Diversification Opportunities for Hartford Healthcare and Hartford Schroders

0.14

Correlation Coefficient

Hartford Healthcare  Hartford Schroders

Average diversification

The 3 months correlation between Hartford and Hartford is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Healthcare Hls and Hartford Schroders Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Schroders 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 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 Hartford Healthcare i.e., Hartford Healthcare and Hartford Schroders go up and down completely randomly.

Pair Corralation between Hartford Healthcare and Hartford Schroders

Assuming the 90 days horizon Hartford Healthcare is expected to generate 2.66 times less return on investment than Hartford Schroders. In addition to that, Hartford Healthcare is 2.39 times more volatile than Hartford Schroders Sustainable. It trades about 0.02 of its total potential returns per unit of risk. Hartford Schroders Sustainable is currently generating about 0.15 per unit of volatility. If you would invest  847.00  in Hartford Schroders Sustainable on December 23, 2024 and sell it today you would earn a total of  28.00  from holding Hartford Schroders Sustainable or generate 3.31% return on investment over 90 days.

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

Hartford Healthcare Hls  vs.  Hartford Schroders Sustainable

Hartford Healthcare Hls

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hartford Healthcare Hls are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Hartford Healthcare is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Hartford Schroders

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hartford Schroders Sustainable are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental 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 Hartford Healthcare and Hartford Schroders

The main advantage of trading using opposite Hartford Healthcare and Hartford Schroders positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Healthcare 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 Hartford Healthcare Hls and Hartford Schroders Sustainable 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.