Correlation Between Matson Money and Jhancock Multi

Can any of the company-specific risk be diversified away by investing in both Matson Money and Jhancock Multi 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 Matson Money and Jhancock Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Matson Money Equity and Jhancock Multi Index 2065, you can compare the effects of market volatilities on Matson Money and Jhancock Multi 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 Matson Money with a short position of Jhancock Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matson Money and Jhancock Multi.

Diversification Opportunities for Matson Money and Jhancock Multi

0.87

Correlation Coefficient

Matson Money  Jhancock Multi

Very poor diversification

The 3 months correlation between Matson and Jhancock is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Matson Money Equity and Jhancock Multi Index 2065 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Multi Index and Matson Money 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 Matson Money Equity are associated (or correlated) with Jhancock Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Multi Index has no effect on the direction of Matson Money i.e., Matson Money and Jhancock Multi go up and down completely randomly.

Pair Corralation between Matson Money and Jhancock Multi

Assuming the 90 days horizon Matson Money Equity is expected to under-perform the Jhancock Multi. In addition to that, Matson Money is 1.13 times more volatile than Jhancock Multi Index 2065. It trades about -0.29 of its total potential returns per unit of risk. Jhancock Multi Index 2065 is currently generating about -0.06 per unit of volatility. If you would invest  1,502  in Jhancock Multi Index 2065 on September 27, 2024 and sell it today you would lose (14.00) from holding Jhancock Multi Index 2065 or give up 0.93% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.45%
Values	Daily Returns

Matson Money Equity  vs.  Jhancock Multi Index 2065

Matson Money Equity

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Matson Money Equity are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Matson Money is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Jhancock Multi Index

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jhancock Multi Index 2065 are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward-looking indicators, Jhancock Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Matson Money and Jhancock Multi

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

The idea behind Matson Money Equity and Jhancock Multi Index 2065 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.