Correlation Between Cbre Clarion and John Hancock

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

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

Diversification Opportunities for Cbre Clarion and John Hancock

0.95

Correlation Coefficient

Cbre Clarion  John Hancock

Almost no diversification

The 3 months correlation between CBRE and John is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Cbre Clarion Global and John Hancock Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Hedged and Cbre Clarion 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 Cbre Clarion Global 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 Hedged has no effect on the direction of Cbre Clarion i.e., Cbre Clarion and John Hancock go up and down completely randomly.

Pair Corralation between Cbre Clarion and John Hancock

Considering the 90-day investment horizon Cbre Clarion Global is expected to generate 2.2 times more return on investment than John Hancock. However, Cbre Clarion is 2.2 times more volatile than John Hancock Hedged. It trades about 0.03 of its potential returns per unit of risk. John Hancock Hedged is currently generating about 0.04 per unit of risk. If you would invest  449.00  in Cbre Clarion Global on December 2, 2024 and sell it today you would earn a total of  81.00  from holding Cbre Clarion Global or generate 18.04% return on investment over 90 days.

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

Cbre Clarion Global  vs.  John Hancock Hedged

Cbre Clarion Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cbre Clarion Global has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable technical and fundamental indicators, Cbre Clarion is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

John Hancock Hedged

Risk-Adjusted Performance

Very Weak

Over the last 90 days John Hancock Hedged has generated negative risk-adjusted returns adding no value to investors with long positions. 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.

Pair Trading with Cbre Clarion and John Hancock

The main advantage of trading using opposite Cbre Clarion and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cbre Clarion 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 Cbre Clarion Global and John Hancock Hedged 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.