Correlation Between Astor Longshort and John Hancock

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

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

Diversification Opportunities for Astor Longshort and John Hancock

0.58

Correlation Coefficient

Astor Longshort  John Hancock

Very weak diversification

The 3 months correlation between Astor and John is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Astor Longshort Fund and John Hancock Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Funds and Astor Longshort 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 Astor Longshort Fund 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 Funds has no effect on the direction of Astor Longshort i.e., Astor Longshort and John Hancock go up and down completely randomly.

Pair Corralation between Astor Longshort and John Hancock

Assuming the 90 days horizon Astor Longshort is expected to generate 1.52 times less return on investment than John Hancock. In addition to that, Astor Longshort is 1.2 times more volatile than John Hancock Funds. It trades about 0.04 of its total potential returns per unit of risk. John Hancock Funds is currently generating about 0.08 per unit of volatility. If you would invest  939.00  in John Hancock Funds on September 24, 2024 and sell it today you would earn a total of  169.00  from holding John Hancock Funds or generate 18.0% return on investment over 90 days.

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

Astor Longshort Fund  vs.  John Hancock Funds

Astor Longshort

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Astor Longshort Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

John Hancock Funds

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days John Hancock Funds has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic 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 Astor Longshort and John Hancock

The main advantage of trading using opposite Astor Longshort and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astor Longshort 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 Astor Longshort Fund and John Hancock Funds 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.