Correlation Between John Hancock and Deutsche Global
Can any of the company-specific risk be diversified away by investing in both John Hancock and Deutsche Global 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 Deutsche Global 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 Deutsche Global Inflation, you can compare the effects of market volatilities on John Hancock and Deutsche Global 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 Deutsche Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Deutsche Global.
Diversification Opportunities for John Hancock and Deutsche Global
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between John and Deutsche is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Deutsche Global Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Global Inflation 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 Deutsche Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Global Inflation has no effect on the direction of John Hancock i.e., John Hancock and Deutsche Global go up and down completely randomly.
Pair Corralation between John Hancock and Deutsche Global
Considering the 90-day investment horizon John Hancock Financial is expected to under-perform the Deutsche Global. In addition to that, John Hancock is 4.4 times more volatile than Deutsche Global Inflation. It trades about -0.01 of its total potential returns per unit of risk. Deutsche Global Inflation is currently generating about 0.21 per unit of volatility. If you would invest 954.00 in Deutsche Global Inflation on September 15, 2024 and sell it today you would earn a total of 8.00 from holding Deutsche Global Inflation or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Financial vs. Deutsche Global Inflation
Performance |
| Timeline |
| John Hancock Financial |
| Deutsche Global Inflation |
John Hancock and Deutsche Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Deutsche Global
The main advantage of trading using opposite John Hancock and Deutsche Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Deutsche Global 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 Deutsche Global will offset losses from the drop in Deutsche Global's long position.| John Hancock vs. MFS High Income | John Hancock vs. MFS High Yield | John Hancock vs. Blackrock Muniholdings Quality | John Hancock vs. MFS Government Markets |
| Deutsche Global vs. Gabelli Global Financial | Deutsche Global vs. John Hancock Financial | Deutsche Global vs. Goldman Sachs Financial | Deutsche Global vs. Financials Ultrasector Profund |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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