Correlation Between Petroleo Brasileiro and Jhancock Multimanager

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

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

Diversification Opportunities for Petroleo Brasileiro and Jhancock Multimanager

0.13

Correlation Coefficient

Petroleo Brasileiro  Jhancock Multimanager

Average diversification

The 3 months correlation between Petroleo and Jhancock is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and Jhancock Multimanager 2065 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Multimanager and Petroleo Brasileiro 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 Petroleo Brasileiro Petrobras 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 Petroleo Brasileiro i.e., Petroleo Brasileiro and Jhancock Multimanager go up and down completely randomly.

Pair Corralation between Petroleo Brasileiro and Jhancock Multimanager

Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to under-perform the Jhancock Multimanager. In addition to that, Petroleo Brasileiro is 2.4 times more volatile than Jhancock Multimanager 2065. It trades about -0.01 of its total potential returns per unit of risk. Jhancock Multimanager 2065 is currently generating about 0.05 per unit of volatility. If you would invest  1,201  in Jhancock Multimanager 2065 on October 7, 2024 and sell it today you would earn a total of  113.00  from holding Jhancock Multimanager 2065 or generate 9.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Petroleo Brasileiro Petrobras  vs.  Jhancock Multimanager 2065

Petroleo Brasileiro

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Petroleo Brasileiro Petrobras has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's fundamental drivers remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Jhancock Multimanager

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jhancock Multimanager 2065 has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Jhancock Multimanager is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Petroleo Brasileiro and Jhancock Multimanager

The main advantage of trading using opposite Petroleo Brasileiro and Jhancock Multimanager positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro 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 Petroleo Brasileiro Petrobras 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.