Correlation Between Oklahoma College and The Hartford

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

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

Diversification Opportunities for Oklahoma College and The Hartford

0.89

Correlation Coefficient

Oklahoma College  The Hartford

Very poor diversification

The 3 months correlation between Oklahoma and The is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Oklahoma College Savings and The Hartford Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Small and Oklahoma College 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 Oklahoma College Savings 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 Small has no effect on the direction of Oklahoma College i.e., Oklahoma College and The Hartford go up and down completely randomly.

Pair Corralation between Oklahoma College and The Hartford

Assuming the 90 days horizon Oklahoma College is expected to generate 1.25 times less return on investment than The Hartford. In addition to that, Oklahoma College is 1.01 times more volatile than The Hartford Small. It trades about 0.14 of its total potential returns per unit of risk. The Hartford Small is currently generating about 0.17 per unit of volatility. If you would invest  2,804  in The Hartford Small on September 4, 2024 and sell it today you would earn a total of  347.00  from holding The Hartford Small or generate 12.38% return on investment over 90 days.

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

Oklahoma College Savings  vs.  The Hartford Small

Oklahoma College Savings

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Oklahoma College Savings are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Oklahoma College may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Hartford Small

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Hartford Small are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, The Hartford may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Oklahoma College and The Hartford

The main advantage of trading using opposite Oklahoma College and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oklahoma College 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 Oklahoma College Savings and The Hartford Small 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 CEOs Directory module to screen CEOs from public companies around the world.