Correlation Between John Hancock and IHIT

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

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

Diversification Opportunities for John Hancock and IHIT

0.0

Correlation Coefficient

John Hancock  IHIT

Pay attention - limited upside

The 3 months correlation between John and IHIT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Income and IHIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHIT 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 Income are associated (or correlated) with IHIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHIT has no effect on the direction of John Hancock i.e., John Hancock and IHIT go up and down completely randomly.

Pair Corralation between John Hancock and IHIT

If you would invest  1,104  in John Hancock Income on December 27, 2024 and sell it today you would earn a total of  21.00  from holding John Hancock Income or generate 1.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

John Hancock Income  vs.  IHIT

John Hancock Income

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Income are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical indicators, John Hancock is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

IHIT

Risk-Adjusted Performance

Very Weak

Over the last 90 days IHIT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward indicators, IHIT is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with John Hancock and IHIT

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

The idea behind John Hancock Income and IHIT 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.