Correlation Between Voya Global and John Hancock
Can any of the company-specific risk be diversified away by investing in both Voya 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 Voya 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 Voya Global Equity and John Hancock Preferred, you can compare the effects of market volatilities on Voya 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 Voya Global with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Global and John Hancock.
Diversification Opportunities for Voya Global and John Hancock
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and John is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Voya Global Equity and John Hancock Preferred in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Preferred and Voya 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 Voya Global Equity 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 Preferred has no effect on the direction of Voya Global i.e., Voya Global and John Hancock go up and down completely randomly.
Pair Corralation between Voya Global and John Hancock
Considering the 90-day investment horizon Voya Global Equity is expected to generate 0.65 times more return on investment than John Hancock. However, Voya Global Equity is 1.53 times less risky than John Hancock. It trades about 0.17 of its potential returns per unit of risk. John Hancock Preferred is currently generating about 0.09 per unit of risk. If you would invest 536.00 in Voya Global Equity on December 3, 2024 and sell it today you would earn a total of 24.00 from holding Voya Global Equity or generate 4.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Voya Global Equity vs. John Hancock Preferred
Performance |
Timeline |
Voya Global Equity |
John Hancock Preferred |
Voya Global and John Hancock Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Voya Global and John Hancock
The main advantage of trading using opposite Voya Global and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya 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.Voya Global vs. Eaton Vance Tax | Voya Global vs. Eaton Vance Tax | Voya Global vs. Eaton Vance Tax | Voya Global vs. Eaton Vance Tax |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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