Correlation Between John Hancock and Aquagold International
Can any of the company-specific risk be diversified away by investing in both John Hancock and Aquagold International 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 Aquagold International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Global and Aquagold International, you can compare the effects of market volatilities on John Hancock and Aquagold International 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 Aquagold International. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Aquagold International.
Diversification Opportunities for John Hancock and Aquagold International
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between John and Aquagold is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Global and Aquagold International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquagold International 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 Global are associated (or correlated) with Aquagold International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquagold International has no effect on the direction of John Hancock i.e., John Hancock and Aquagold International go up and down completely randomly.
Pair Corralation between John Hancock and Aquagold International
Assuming the 90 days horizon John Hancock Global is expected to generate 0.06 times more return on investment than Aquagold International. However, John Hancock Global is 15.76 times less risky than Aquagold International. It trades about -0.07 of its potential returns per unit of risk. Aquagold International is currently generating about -0.17 per unit of risk. If you would invest 1,242 in John Hancock Global on December 5, 2024 and sell it today you would lose (43.00) from holding John Hancock Global or give up 3.46% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.16% |
Values | Daily Returns |
John Hancock Global vs. Aquagold International
Performance |
Timeline |
John Hancock Global |
Aquagold International |
John Hancock and Aquagold International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with John Hancock and Aquagold International
The main advantage of trading using opposite John Hancock and Aquagold International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Aquagold International 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 Aquagold International will offset losses from the drop in Aquagold International's long position.John Hancock vs. Bbh Intermediate Municipal | John Hancock vs. Access Capital Munity | John Hancock vs. Franklin Adjustable Government | John Hancock vs. Lord Abbett Intermediate |
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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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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