Correlation Between J Hancock and John Hancock
Can any of the company-specific risk be diversified away by investing in both J Hancock 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 J Hancock and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J Hancock Ii and John Hancock Mid, you can compare the effects of market volatilities on J Hancock 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 J Hancock with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Hancock and John Hancock.
Diversification Opportunities for J Hancock and John Hancock
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JRETX and John is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding J Hancock Ii and John Hancock Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Mid and J 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 J Hancock Ii 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 Mid has no effect on the direction of J Hancock i.e., J Hancock and John Hancock go up and down completely randomly.
Pair Corralation between J Hancock and John Hancock
Assuming the 90 days horizon J Hancock is expected to generate 2.48 times less return on investment than John Hancock. But when comparing it to its historical volatility, J Hancock Ii is 3.17 times less risky than John Hancock. It trades about 0.27 of its potential returns per unit of risk. John Hancock Mid is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,776 in John Hancock Mid on September 19, 2024 and sell it today you would earn a total of 95.00 from holding John Hancock Mid or generate 5.35% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
J Hancock Ii vs. John Hancock Mid
Performance |
Timeline |
J Hancock Ii |
John Hancock Mid |
J Hancock and John Hancock Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with J Hancock and John Hancock
The main advantage of trading using opposite J Hancock and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Hancock 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.J Hancock vs. Regional Bank Fund | ||
J Hancock vs. Regional Bank Fund | ||
J Hancock vs. Multimanager Lifestyle Moderate | ||
J Hancock vs. Multimanager Lifestyle Balanced |
John Hancock vs. Davis Financial Fund | ||
John Hancock vs. Angel Oak Financial | ||
John Hancock vs. Goldman Sachs Financial | ||
John Hancock vs. Transamerica Financial Life |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |