Correlation Between Wells Fargo and The Hartford

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

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

Diversification Opportunities for Wells Fargo and The Hartford

0.79

Correlation Coefficient

Wells Fargo  The Hartford

Poor diversification

The 3 months correlation between Wells and The is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Wells Fargo Mon and The Hartford Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Global and Wells Fargo 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 Wells Fargo Mon 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 Global has no effect on the direction of Wells Fargo i.e., Wells Fargo and The Hartford go up and down completely randomly.

Pair Corralation between Wells Fargo and The Hartford

Assuming the 90 days horizon Wells Fargo is expected to generate 5.94 times less return on investment than The Hartford. In addition to that, Wells Fargo is 2.49 times more volatile than The Hartford Global. It trades about 0.01 of its total potential returns per unit of risk. The Hartford Global is currently generating about 0.18 per unit of volatility. If you would invest  896.00  in The Hartford Global on May 13, 2025 and sell it today you would earn a total of  37.00  from holding The Hartford Global or generate 4.13% return on investment over 90 days.

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

Wells Fargo Mon  vs.  The Hartford Global

Wells Fargo Mon

Risk-Adjusted Performance

Weakest

Over the last 90 days Wells Fargo Mon has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Wells Fargo is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Hartford Global

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Hartford Global are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, The Hartford is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Wells Fargo and The Hartford

The main advantage of trading using opposite Wells Fargo and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wells Fargo 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 Wells Fargo Mon and The Hartford Global 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.