Correlation Between Hartford Stock and The Hartford

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

By analyzing existing cross correlation between Hartford Stock Hls and The Hartford Growth, you can compare the effects of market volatilities on Hartford Stock 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 Hartford Stock with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Stock and The Hartford.

Diversification Opportunities for Hartford Stock and The Hartford

0.31

Correlation Coefficient

Hartford Stock  The Hartford

Weak diversification

The 3 months correlation between Hartford and The is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Stock Hls and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth and Hartford Stock 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 Stock Hls 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 Growth has no effect on the direction of Hartford Stock i.e., Hartford Stock and The Hartford go up and down completely randomly.

Pair Corralation between Hartford Stock and The Hartford

Assuming the 90 days horizon Hartford Stock Hls is expected to generate 0.42 times more return on investment than The Hartford. However, Hartford Stock Hls is 2.38 times less risky than The Hartford. It trades about 0.01 of its potential returns per unit of risk. The Hartford Growth is currently generating about -0.1 per unit of risk. If you would invest  10,036  in Hartford Stock Hls on December 28, 2024 and sell it today you would earn a total of  42.00  from holding Hartford Stock Hls or generate 0.42% return on investment over 90 days.

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

Hartford Stock Hls  vs.  The Hartford Growth

Hartford Stock Hls

Risk-Adjusted Performance

Weak

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

Hartford Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Hartford Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Hartford Stock and The Hartford

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

The idea behind Hartford Stock Hls and The Hartford Growth 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.