Correlation Between Deutsche Health and John Hancock

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

By analyzing existing cross correlation between Deutsche Health And and John Hancock Opportunistic, you can compare the effects of market volatilities on Deutsche Health 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 Deutsche Health with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Health and John Hancock.

Diversification Opportunities for Deutsche Health and John Hancock

0.79

Correlation Coefficient

Deutsche Health  John Hancock

Poor diversification

The 3 months correlation between Deutsche and John is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Health And and John Hancock Opportunistic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Opportu and Deutsche Health 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 Deutsche Health And 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 Opportu has no effect on the direction of Deutsche Health i.e., Deutsche Health and John Hancock go up and down completely randomly.

Pair Corralation between Deutsche Health and John Hancock

Assuming the 90 days horizon Deutsche Health And is expected to under-perform the John Hancock. In addition to that, Deutsche Health is 4.13 times more volatile than John Hancock Opportunistic. It trades about -0.06 of its total potential returns per unit of risk. John Hancock Opportunistic is currently generating about 0.0 per unit of volatility. If you would invest  1,191  in John Hancock Opportunistic on September 18, 2024 and sell it today you would earn a total of  0.00  from holding John Hancock Opportunistic or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Deutsche Health And  vs.  John Hancock Opportunistic

Deutsche Health And

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Deutsche Health And has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's essential indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

John Hancock Opportu

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Deutsche Health and John Hancock

The main advantage of trading using opposite Deutsche Health and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Health 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.

The idea behind Deutsche Health And and John Hancock Opportunistic 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.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.