Correlation Between John Hancock and PIMCO Access

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

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

Diversification Opportunities for John Hancock and PIMCO Access

0.53

Correlation Coefficient

John Hancock  PIMCO Access

Very weak diversification

The 3 months correlation between John and PIMCO is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Hedged and PIMCO Access Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO Access Income and John Hancock 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 John Hancock Hedged are associated (or correlated) with PIMCO Access. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO Access Income has no effect on the direction of John Hancock i.e., John Hancock and PIMCO Access go up and down completely randomly.

Pair Corralation between John Hancock and PIMCO Access

Considering the 90-day investment horizon John Hancock is expected to generate 2.59 times less return on investment than PIMCO Access. In addition to that, John Hancock is 1.01 times more volatile than PIMCO Access Income. It trades about 0.08 of its total potential returns per unit of risk. PIMCO Access Income is currently generating about 0.2 per unit of volatility. If you would invest  1,497  in PIMCO Access Income on December 27, 2024 and sell it today you would earn a total of  117.00  from holding PIMCO Access Income or generate 7.82% return on investment over 90 days.

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

John Hancock Hedged  vs.  PIMCO Access Income

John Hancock Hedged

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Hedged are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical and fundamental indicators, John Hancock is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

PIMCO Access Income

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PIMCO Access Income are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, PIMCO Access may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with John Hancock and PIMCO Access

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

The idea behind John Hancock Hedged and PIMCO Access Income 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.