Correlation Between Dodge International and John Hancock
Can any of the company-specific risk be diversified away by investing in both Dodge International 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 Dodge International and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dodge International Stock and John Hancock Investment, you can compare the effects of market volatilities on Dodge International 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 Dodge International with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge International and John Hancock.
Diversification Opportunities for Dodge International and John Hancock
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dodge and John is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Dodge International Stock and John Hancock Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Investment and Dodge International 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 Dodge International Stock 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 Investment has no effect on the direction of Dodge International i.e., Dodge International and John Hancock go up and down completely randomly.
Pair Corralation between Dodge International and John Hancock
Assuming the 90 days horizon Dodge International Stock is expected to generate 1.99 times more return on investment than John Hancock. However, Dodge International is 1.99 times more volatile than John Hancock Investment. It trades about 0.06 of its potential returns per unit of risk. John Hancock Investment is currently generating about 0.04 per unit of risk. If you would invest 4,186 in Dodge International Stock on September 18, 2024 and sell it today you would earn a total of 1,057 from holding Dodge International Stock or generate 25.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Dodge International Stock vs. John Hancock Investment
Performance |
Timeline |
Dodge International Stock |
John Hancock Investment |
Dodge International and John Hancock Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dodge International and John Hancock
The main advantage of trading using opposite Dodge International and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge International 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.Dodge International vs. Dodge Stock Fund | Dodge International vs. Dodge Income Fund | Dodge International vs. Dodge Balanced Fund | Dodge International vs. The Fairholme Fund |
John Hancock vs. Dodge International Stock | John Hancock vs. Ab Fixed Income Shares | John Hancock vs. Huber Capital Equity | John Hancock vs. Ab Select Equity |
Check out your portfolio center.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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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