Correlation Between John Hancock and Manning Napier
Can any of the company-specific risk be diversified away by investing in both John Hancock and Manning Napier 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 Manning Napier 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 Manning Napier Rainier, you can compare the effects of market volatilities on John Hancock and Manning Napier 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 Manning Napier. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Manning Napier.
Diversification Opportunities for John Hancock and Manning Napier
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between John and Manning is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Manning Napier Rainier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manning Napier Rainier 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 Manning Napier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manning Napier Rainier has no effect on the direction of John Hancock i.e., John Hancock and Manning Napier go up and down completely randomly.
Pair Corralation between John Hancock and Manning Napier
Considering the 90-day investment horizon John Hancock is expected to generate 1.79 times less return on investment than Manning Napier. In addition to that, John Hancock is 1.3 times more volatile than Manning Napier Rainier. It trades about 0.09 of its total potential returns per unit of risk. Manning Napier Rainier is currently generating about 0.21 per unit of volatility. If you would invest 2,345 in Manning Napier Rainier on September 13, 2024 and sell it today you would earn a total of 63.00 from holding Manning Napier Rainier or generate 2.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Financial vs. Manning Napier Rainier
Performance |
| Timeline |
| John Hancock Financial |
| Manning Napier Rainier |
John Hancock and Manning Napier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Manning Napier
The main advantage of trading using opposite John Hancock and Manning Napier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Manning Napier 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 Manning Napier will offset losses from the drop in Manning Napier'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 |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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