Correlation Between John Hancock and Science Technology

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

By analyzing existing cross correlation between John Hancock Variable and Science Technology Fund, you can compare the effects of market volatilities on John Hancock and Science Technology 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 Science Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Science Technology.

Diversification Opportunities for John Hancock and Science Technology

0.93

Correlation Coefficient

John Hancock  Science Technology

Almost no diversification

The 3 months correlation between John and Science is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Variable and Science Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Science Technology 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 Variable are associated (or correlated) with Science Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Science Technology has no effect on the direction of John Hancock i.e., John Hancock and Science Technology go up and down completely randomly.

Pair Corralation between John Hancock and Science Technology

Assuming the 90 days horizon John Hancock Variable is expected to generate 1.04 times more return on investment than Science Technology. However, John Hancock is 1.04 times more volatile than Science Technology Fund. It trades about 0.07 of its potential returns per unit of risk. Science Technology Fund is currently generating about 0.06 per unit of risk. If you would invest  2,007  in John Hancock Variable on September 22, 2024 and sell it today you would earn a total of  39.00  from holding John Hancock Variable or generate 1.94% return on investment over 90 days.

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

John Hancock Variable  vs.  Science Technology Fund

John Hancock Variable

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Variable are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, John Hancock may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Science Technology

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Science Technology Fund are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Science Technology may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with John Hancock and Science Technology

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

The idea behind John Hancock Variable and Science Technology Fund 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.