Correlation Between Artisan Global and John Hancock

Can any of the company-specific risk be diversified away by investing in both Artisan Global 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 Global 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 Global Opportunities and John Hancock Esg, you can compare the effects of market volatilities on Artisan Global 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 Global with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Global and John Hancock.

Diversification Opportunities for Artisan Global and John Hancock

0.68

Correlation Coefficient

Artisan Global  John Hancock

Poor diversification

The 3 months correlation between Artisan and John is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Global Opportunities and John Hancock Esg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Esg and Artisan Global 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 Global Opportunities 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 Esg has no effect on the direction of Artisan Global i.e., Artisan Global and John Hancock go up and down completely randomly.

Pair Corralation between Artisan Global and John Hancock

Assuming the 90 days horizon Artisan Global Opportunities is expected to generate 1.19 times more return on investment than John Hancock. However, Artisan Global is 1.19 times more volatile than John Hancock Esg. It trades about -0.03 of its potential returns per unit of risk. John Hancock Esg is currently generating about -0.08 per unit of risk. If you would invest  3,208  in Artisan Global Opportunities on December 20, 2024 and sell it today you would lose (68.00) from holding Artisan Global Opportunities or give up 2.12% of portfolio value over 90 days.

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

Artisan Global Opportunities  vs.  John Hancock Esg

Artisan Global Oppor

Risk-Adjusted Performance

Very Weak

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

John Hancock Esg

Risk-Adjusted Performance

Very Weak

Over the last 90 days John Hancock Esg has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward 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 Global and John Hancock

The main advantage of trading using opposite Artisan Global and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Global 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 Global Opportunities and John Hancock Esg 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.