Correlation Between Clearbridge Energy and John Hancock

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

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

Diversification Opportunities for Clearbridge Energy and John Hancock

-0.56

Correlation Coefficient

Clearbridge Energy  John Hancock

Excellent diversification

The 3 months correlation between Clearbridge and John is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Clearbridge Energy Mlp and John Hancock Var in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Var and Clearbridge Energy 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 Clearbridge Energy Mlp 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 Var has no effect on the direction of Clearbridge Energy i.e., Clearbridge Energy and John Hancock go up and down completely randomly.

Pair Corralation between Clearbridge Energy and John Hancock

Assuming the 90 days horizon Clearbridge Energy Mlp is expected to generate 1.31 times more return on investment than John Hancock. However, Clearbridge Energy is 1.31 times more volatile than John Hancock Var. It trades about 0.1 of its potential returns per unit of risk. John Hancock Var is currently generating about -0.15 per unit of risk. If you would invest  4,938  in Clearbridge Energy Mlp on October 6, 2024 and sell it today you would earn a total of  275.00  from holding Clearbridge Energy Mlp or generate 5.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Clearbridge Energy Mlp  vs.  John Hancock Var

Clearbridge Energy Mlp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Clearbridge Energy Mlp are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Clearbridge Energy may actually be approaching a critical reversion point that can send shares even higher in February 2025.

John Hancock Var

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days John Hancock Var has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Clearbridge Energy and John Hancock

The main advantage of trading using opposite Clearbridge Energy and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clearbridge Energy 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 Clearbridge Energy Mlp and John Hancock Var 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.