Correlation Between John Hancock and Foreign Bond
Can any of the company-specific risk be diversified away by investing in both John Hancock and Foreign Bond 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 Foreign Bond 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 Foreign Bond Fund, you can compare the effects of market volatilities on John Hancock and Foreign Bond 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 Foreign Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Foreign Bond.
Diversification Opportunities for John Hancock and Foreign Bond
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between John and Foreign is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Foreign Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foreign Bond 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 Foreign Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foreign Bond has no effect on the direction of John Hancock i.e., John Hancock and Foreign Bond go up and down completely randomly.
Pair Corralation between John Hancock and Foreign Bond
Considering the 90-day investment horizon John Hancock Financial is expected to generate 3.33 times more return on investment than Foreign Bond. However, John Hancock is 3.33 times more volatile than Foreign Bond Fund. It trades about 0.21 of its potential returns per unit of risk. Foreign Bond Fund is currently generating about 0.11 per unit of risk. If you would invest 3,532 in John Hancock Financial on November 3, 2024 and sell it today you would earn a total of 219.00 from holding John Hancock Financial or generate 6.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Financial vs. Foreign Bond Fund
Performance |
| Timeline |
| John Hancock Financial |
| Foreign Bond |
John Hancock and Foreign Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Foreign Bond
The main advantage of trading using opposite John Hancock and Foreign Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Foreign Bond 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 Foreign Bond will offset losses from the drop in Foreign Bond'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 |
| Foreign Bond vs. Delaware Investments Ultrashort | Foreign Bond vs. Virtus Multi Sector Short | Foreign Bond vs. Alpine Ultra Short | Foreign Bond vs. Transamerica Short Term Bond |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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