Correlation Between Artisan High and John Hancock

Can any of the company-specific risk be diversified away by investing in both Artisan High and John Hancock 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 Artisan High and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Artisan High Income and John Hancock Variable, you can compare the effects of market volatilities on Artisan High and John Hancock 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 Artisan High with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan High and John Hancock.

Diversification Opportunities for Artisan High and John Hancock

-0.24

Correlation Coefficient

Artisan High  John Hancock

Very good diversification

The 3 months correlation between Artisan and John is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Artisan High Income and John Hancock Variable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Variable and Artisan High 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 Artisan High Income are associated (or correlated) with John Hancock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Hancock Variable has no effect on the direction of Artisan High i.e., Artisan High and John Hancock go up and down completely randomly.

Pair Corralation between Artisan High and John Hancock

Assuming the 90 days horizon Artisan High is expected to generate 1.34 times less return on investment than John Hancock. But when comparing it to its historical volatility, Artisan High Income is 5.97 times less risky than John Hancock. It trades about 0.29 of its potential returns per unit of risk. John Hancock Variable is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  2,035  in John Hancock Variable on October 23, 2024 and sell it today you would earn a total of  25.00  from holding John Hancock Variable or generate 1.23% return on investment over 90 days.

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

Artisan High Income  vs.  John Hancock Variable

Artisan High Income

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan High Income are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Artisan High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

John Hancock Variable

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Artisan High and John Hancock

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

The idea behind Artisan High Income and John Hancock Variable 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.