Correlation Between John Hancock and Dunham Monthly
Can any of the company-specific risk be diversified away by investing in both John Hancock and Dunham Monthly 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 John Hancock and Dunham Monthly into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Financial and Dunham Monthly Distribution, you can compare the effects of market volatilities on John Hancock and Dunham Monthly 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 John Hancock with a short position of Dunham Monthly. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Dunham Monthly.
Diversification Opportunities for John Hancock and Dunham Monthly
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between John and Dunham is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Dunham Monthly Distribution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Monthly Distr and John Hancock 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 John Hancock Financial are associated (or correlated) with Dunham Monthly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Monthly Distr has no effect on the direction of John Hancock i.e., John Hancock and Dunham Monthly go up and down completely randomly.
Pair Corralation between John Hancock and Dunham Monthly
Considering the 90-day investment horizon John Hancock Financial is expected to generate 2.78 times more return on investment than Dunham Monthly. However, John Hancock is 2.78 times more volatile than Dunham Monthly Distribution. It trades about 0.09 of its potential returns per unit of risk. Dunham Monthly Distribution is currently generating about -0.23 per unit of risk. If you would invest 3,800 in John Hancock Financial on September 13, 2024 and sell it today you would earn a total of 55.00 from holding John Hancock Financial or generate 1.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Financial vs. Dunham Monthly Distribution
Performance |
| Timeline |
| John Hancock Financial |
| Dunham Monthly Distr |
John Hancock and Dunham Monthly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Dunham Monthly
The main advantage of trading using opposite John Hancock and Dunham Monthly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Dunham Monthly 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 Dunham Monthly will offset losses from the drop in Dunham Monthly's long position.| John Hancock vs. Tekla Life Sciences | John Hancock vs. Tekla World Healthcare | John Hancock vs. Tekla Healthcare Opportunities | John Hancock vs. Royce Value Closed |
| Dunham Monthly vs. Rbc Microcap Value | Dunham Monthly vs. Scharf Global Opportunity | Dunham Monthly vs. Balanced Fund Investor | Dunham Monthly vs. Leggmason Partners Institutional |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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