Correlation Between Limited Term and Jhancock Multimanager

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

By analyzing existing cross correlation between Limited Term Tax and Jhancock Multimanager 2065, you can compare the effects of market volatilities on Limited Term and Jhancock Multimanager 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 Limited Term with a short position of Jhancock Multimanager. Check out your portfolio center. Please also check ongoing floating volatility patterns of Limited Term and Jhancock Multimanager.

Diversification Opportunities for Limited Term and Jhancock Multimanager

-0.14

Correlation Coefficient

Limited Term  Jhancock Multimanager

Good diversification

The 3 months correlation between LIMITED and Jhancock is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Limited Term Tax and Jhancock Multimanager 2065 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Multimanager and Limited Term 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 Limited Term Tax are associated (or correlated) with Jhancock Multimanager. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Multimanager has no effect on the direction of Limited Term i.e., Limited Term and Jhancock Multimanager go up and down completely randomly.

Pair Corralation between Limited Term and Jhancock Multimanager

Assuming the 90 days horizon Limited Term is expected to generate 17.75 times less return on investment than Jhancock Multimanager. But when comparing it to its historical volatility, Limited Term Tax is 4.31 times less risky than Jhancock Multimanager. It trades about 0.04 of its potential returns per unit of risk. Jhancock Multimanager 2065 is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  1,307  in Jhancock Multimanager 2065 on September 4, 2024 and sell it today you would earn a total of  95.00  from holding Jhancock Multimanager 2065 or generate 7.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Limited Term Tax  vs.  Jhancock Multimanager 2065

Limited Term Tax

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Limited Term Tax are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Limited Term is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Jhancock Multimanager

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Jhancock Multimanager 2065 are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Jhancock Multimanager may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Limited Term and Jhancock Multimanager

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

The idea behind Limited Term Tax and Jhancock Multimanager 2065 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.