Correlation Between Hartford Total and SPDR SSGA
Can any of the company-specific risk be diversified away by investing in both Hartford Total and SPDR SSGA 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 SPDR SSGA 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 SPDR SSGA Sector, you can compare the effects of market volatilities on Hartford Total and SPDR SSGA 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 SPDR SSGA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Total and SPDR SSGA.
Diversification Opportunities for Hartford Total and SPDR SSGA
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hartford and SPDR is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Total Return and SPDR SSGA Sector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SSGA Sector 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 SPDR SSGA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SSGA Sector has no effect on the direction of Hartford Total i.e., Hartford Total and SPDR SSGA go up and down completely randomly.
Pair Corralation between Hartford Total and SPDR SSGA
Given the investment horizon of 90 days Hartford Total Return is expected to generate 0.53 times more return on investment than SPDR SSGA. However, Hartford Total Return is 1.88 times less risky than SPDR SSGA. It trades about -0.2 of its potential returns per unit of risk. SPDR SSGA Sector is currently generating about -0.21 per unit of risk. If you would invest 3,333 in Hartford Total Return on February 2, 2024 and sell it today you would lose (61.00) from holding Hartford Total Return or give up 1.83% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hartford Total Return vs. SPDR SSGA Sector
Performance |
Timeline |
Hartford Total Return |
SPDR SSGA Sector |
Hartford Total and SPDR SSGA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hartford Total and SPDR SSGA
The main advantage of trading using opposite Hartford Total and SPDR SSGA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Total position performs unexpectedly, SPDR SSGA 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 SPDR SSGA will offset losses from the drop in SPDR SSGA's long position.Hartford Total vs. JPMorgan BetaBuilders International | Hartford Total vs. JPMorgan BetaBuilders 1 5 | Hartford Total vs. JPMorgan BetaBuilders Equity | Hartford Total vs. JPMorgan Emerging Markets |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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