Correlation Between John Hancock and Tax-exempt Fund
Can any of the company-specific risk be diversified away by investing in both John Hancock and Tax-exempt Fund 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 Tax-exempt Fund 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 Tax Exempt Fund Of, you can compare the effects of market volatilities on John Hancock and Tax-exempt Fund 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 Tax-exempt Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Tax-exempt Fund.
Diversification Opportunities for John Hancock and Tax-exempt Fund
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between John and Tax-exempt is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Tax Exempt Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tax Exempt Fund 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 Tax-exempt Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tax Exempt Fund has no effect on the direction of John Hancock i.e., John Hancock and Tax-exempt Fund go up and down completely randomly.
Pair Corralation between John Hancock and Tax-exempt Fund
Considering the 90-day investment horizon John Hancock Financial is expected to generate 7.44 times more return on investment than Tax-exempt Fund. However, John Hancock is 7.44 times more volatile than Tax Exempt Fund Of. It trades about 0.12 of its potential returns per unit of risk. Tax Exempt Fund Of is currently generating about 0.13 per unit of risk. If you would invest 2,436 in John Hancock Financial on August 24, 2024 and sell it today you would earn a total of 1,387 from holding John Hancock Financial or generate 56.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Financial vs. Tax Exempt Fund Of
Performance |
| Timeline |
| John Hancock Financial |
| Tax Exempt Fund |
John Hancock and Tax-exempt Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Tax-exempt Fund
The main advantage of trading using opposite John Hancock and Tax-exempt Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Tax-exempt Fund 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 Tax-exempt Fund will offset losses from the drop in Tax-exempt Fund'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 |
| Tax-exempt Fund vs. Transamerica Financial Life | Tax-exempt Fund vs. John Hancock Financial | Tax-exempt Fund vs. Royce Global Financial | Tax-exempt Fund vs. Goldman Sachs Financial |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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