Correlation Between Axa SA and Hartford Financial
Can any of the company-specific risk be diversified away by investing in both Axa SA and Hartford Financial 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 Axa SA and Hartford Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axa SA ADR and Hartford Financial Services, you can compare the effects of market volatilities on Axa SA and Hartford Financial 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 Axa SA with a short position of Hartford Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axa SA and Hartford Financial.
Diversification Opportunities for Axa SA and Hartford Financial
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Axa and Hartford is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Axa SA ADR and Hartford Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Financial and Axa SA 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 Axa SA ADR are associated (or correlated) with Hartford Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Financial has no effect on the direction of Axa SA i.e., Axa SA and Hartford Financial go up and down completely randomly.
Pair Corralation between Axa SA and Hartford Financial
Assuming the 90 days horizon Axa SA ADR is expected to under-perform the Hartford Financial. But the otc stock apears to be less risky and, when comparing its historical volatility, Axa SA ADR is 1.15 times less risky than Hartford Financial. The otc stock trades about -0.03 of its potential returns per unit of risk. The Hartford Financial Services is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 8,639 in Hartford Financial Services on December 29, 2023 and sell it today you would earn a total of 1,591 from holding Hartford Financial Services or generate 18.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 40.48% |
Values | Daily Returns |
Axa SA ADR vs. Hartford Financial Services
Performance |
Timeline |
Axa SA ADR |
Risk-Adjusted Performance
0 of 100
Low | High |
OK
Hartford Financial |
Axa SA and Hartford Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Axa SA and Hartford Financial
The main advantage of trading using opposite Axa SA and Hartford Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axa SA position performs unexpectedly, Hartford Financial 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 Financial will offset losses from the drop in Hartford Financial's long position.Axa SA vs. NH Foods | Axa SA vs. Avadel Pharmaceuticals PLC | Axa SA vs. Merit Medical Systems | Axa SA vs. Natural Alternatives International |
Hartford Financial vs. Chubb | Hartford Financial vs. NI Holdings | Hartford Financial vs. The Allstate | Hartford Financial vs. CNA Financial |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing |