Correlation Between Eaton Vance and Hartford Schroders

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

By analyzing existing cross correlation between Eaton Vance E and Hartford Schroders Smallmid, you can compare the effects of market volatilities on Eaton Vance and Hartford Schroders 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 Eaton Vance with a short position of Hartford Schroders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Hartford Schroders.

Diversification Opportunities for Eaton Vance and Hartford Schroders

-0.57

Correlation Coefficient

Eaton Vance  Hartford Schroders

Excellent diversification

The 3 months correlation between Eaton and Hartford is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance E and Hartford Schroders Smallmid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Schroders and Eaton Vance 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 Eaton Vance E are associated (or correlated) with Hartford Schroders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Schroders has no effect on the direction of Eaton Vance i.e., Eaton Vance and Hartford Schroders go up and down completely randomly.

Pair Corralation between Eaton Vance and Hartford Schroders

Assuming the 90 days horizon Eaton Vance E is expected to under-perform the Hartford Schroders. But the mutual fund apears to be less risky and, when comparing its historical volatility, Eaton Vance E is 4.24 times less risky than Hartford Schroders. The mutual fund trades about -0.09 of its potential returns per unit of risk. The Hartford Schroders Smallmid is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,899  in Hartford Schroders Smallmid on September 13, 2024 and sell it today you would earn a total of  20.00  from holding Hartford Schroders Smallmid or generate 1.05% return on investment over 90 days.

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

Eaton Vance E  vs.  Hartford Schroders Smallmid

Eaton Vance E

Risk-Adjusted Performance

0 of 100

Very Weak

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

Hartford Schroders

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hartford Schroders Smallmid 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 Schroders is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Eaton Vance and Hartford Schroders

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

The idea behind Eaton Vance E and Hartford Schroders Smallmid 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.