Correlation Between Hartford Total and DB Base

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

By analyzing existing cross correlation between Hartford Total Return and DB Base Metals, you can compare the effects of market volatilities on Hartford Total and DB Base 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 Total with a short position of DB Base. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Total and DB Base.

Diversification Opportunities for Hartford Total and DB Base

0.33

Correlation Coefficient

Hartford Total  DB Base

Weak diversification

The 3 months correlation between Hartford and BDDXF is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Total Return and DB Base Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Base Metals and Hartford Total 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 Total Return are associated (or correlated) with DB Base. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Base Metals has no effect on the direction of Hartford Total i.e., Hartford Total and DB Base go up and down completely randomly.

Pair Corralation between Hartford Total and DB Base

If you would invest  3,183  in Hartford Total Return on October 23, 2024 and sell it today you would earn a total of  150.00  from holding Hartford Total Return or generate 4.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	0.2%
Values	Daily Returns

Hartford Total Return  vs.  DB Base Metals

Hartford Total Return

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hartford Total Return has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Hartford Total is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

DB Base Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DB Base Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, DB Base is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Hartford Total and DB Base

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

The idea behind Hartford Total Return and DB Base Metals 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.