Correlation Between John Hancock and Virtus Real
Can any of the company-specific risk be diversified away by investing in both John Hancock and Virtus Real 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 Virtus Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Government and Virtus Real Estate, you can compare the effects of market volatilities on John Hancock and Virtus Real 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 Virtus Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Virtus Real.
Diversification Opportunities for John Hancock and Virtus Real
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between John and Virtus is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Government and Virtus Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Real Estate 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 Government are associated (or correlated) with Virtus Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Real Estate has no effect on the direction of John Hancock i.e., John Hancock and Virtus Real go up and down completely randomly.
Pair Corralation between John Hancock and Virtus Real
Assuming the 90 days horizon John Hancock Government is expected to generate 0.21 times more return on investment than Virtus Real. However, John Hancock Government is 4.67 times less risky than Virtus Real. It trades about 0.0 of its potential returns per unit of risk. Virtus Real Estate is currently generating about -0.1 per unit of risk. If you would invest 782.00 in John Hancock Government on December 2, 2024 and sell it today you would earn a total of 0.00 from holding John Hancock Government or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
John Hancock Government vs. Virtus Real Estate
Performance |
Timeline |
John Hancock Government |
Virtus Real Estate |
John Hancock and Virtus Real Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with John Hancock and Virtus Real
The main advantage of trading using opposite John Hancock and Virtus Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Virtus Real 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 Virtus Real will offset losses from the drop in Virtus Real's long position.John Hancock vs. Jpmorgan Diversified Fund | John Hancock vs. Global Diversified Income | John Hancock vs. Madison Diversified Income | John Hancock vs. Lord Abbett Diversified |
Virtus Real vs. Dunham Porategovernment Bond | Virtus Real vs. Us Government Securities | Virtus Real vs. Federated Government Income | Virtus Real vs. Us Government Securities |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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