Correlation Between Boeing and John Hancock
Can any of the company-specific risk be diversified away by investing in both Boeing 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 Boeing and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Boeing and John Hancock Hedged, you can compare the effects of market volatilities on Boeing 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 Boeing with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and John Hancock.
Diversification Opportunities for Boeing and John Hancock
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boeing and John is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and John Hancock Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Hedged and Boeing 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 The Boeing 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 Hedged has no effect on the direction of Boeing i.e., Boeing and John Hancock go up and down completely randomly.
Pair Corralation between Boeing and John Hancock
Allowing for the 90-day total investment horizon The Boeing is expected to generate 3.35 times more return on investment than John Hancock. However, Boeing is 3.35 times more volatile than John Hancock Hedged. It trades about 0.1 of its potential returns per unit of risk. John Hancock Hedged is currently generating about 0.26 per unit of risk. If you would invest 14,931 in The Boeing on September 1, 2024 and sell it today you would earn a total of 613.00 from holding The Boeing or generate 4.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Boeing vs. John Hancock Hedged
Performance |
| Timeline |
| Boeing |
| John Hancock Hedged |
Boeing and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boeing and John Hancock
The main advantage of trading using opposite Boeing and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing 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.| Boeing vs. Raytheon Technologies Corp | Boeing vs. Northrop Grumman | Boeing vs. General Dynamics | Boeing vs. L3Harris Technologies |
| John Hancock vs. Ellsworth Convertible Growth | John Hancock vs. Delaware Investments Florida | John Hancock vs. RENN Fund | John Hancock vs. Nuveen New Jersey |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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