Correlation Between John Hancock and Blackrock Financial
Can any of the company-specific risk be diversified away by investing in both John Hancock and Blackrock Financial 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 Blackrock Financial 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 Blackrock Financial Institutions, you can compare the effects of market volatilities on John Hancock and Blackrock Financial 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 Blackrock Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Blackrock Financial.
Diversification Opportunities for John Hancock and Blackrock Financial
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between John and Blackrock is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Blackrock Financial Institutio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Financial 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 Blackrock Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Financial has no effect on the direction of John Hancock i.e., John Hancock and Blackrock Financial go up and down completely randomly.
Pair Corralation between John Hancock and Blackrock Financial
Considering the 90-day investment horizon John Hancock Financial is expected to generate 12.75 times more return on investment than Blackrock Financial. However, John Hancock is 12.75 times more volatile than Blackrock Financial Institutions. It trades about 0.19 of its potential returns per unit of risk. Blackrock Financial Institutions is currently generating about 0.13 per unit of risk. If you would invest 2,661 in John Hancock Financial on August 24, 2024 and sell it today you would earn a total of 1,162 from holding John Hancock Financial or generate 43.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Financial vs. Blackrock Financial Institutio
Performance |
| Timeline |
| John Hancock Financial |
| Blackrock Financial |
John Hancock and Blackrock Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Blackrock Financial
The main advantage of trading using opposite John Hancock and Blackrock Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Blackrock Financial 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 Blackrock Financial will offset losses from the drop in Blackrock Financial'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 |
| Blackrock Financial vs. Growth Income Fund | Blackrock Financial vs. Barings Active Short | Blackrock Financial vs. Astor Longshort Fund | Blackrock Financial vs. Extended Market Index |
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.
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