Correlation Between Columbia Emerging and Jhancock Diversified
Can any of the company-specific risk be diversified away by investing in both Columbia Emerging and Jhancock Diversified 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 Columbia Emerging and Jhancock Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Emerging Markets and Jhancock Diversified Macro, you can compare the effects of market volatilities on Columbia Emerging and Jhancock Diversified 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 Columbia Emerging with a short position of Jhancock Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Emerging and Jhancock Diversified.
Diversification Opportunities for Columbia Emerging and Jhancock Diversified
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Columbia and Jhancock is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Emerging Markets and Jhancock Diversified Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Diversified and Columbia Emerging 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 Columbia Emerging Markets are associated (or correlated) with Jhancock Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Diversified has no effect on the direction of Columbia Emerging i.e., Columbia Emerging and Jhancock Diversified go up and down completely randomly.
Pair Corralation between Columbia Emerging and Jhancock Diversified
Assuming the 90 days horizon Columbia Emerging Markets is expected to generate 0.42 times more return on investment than Jhancock Diversified. However, Columbia Emerging Markets is 2.37 times less risky than Jhancock Diversified. It trades about 0.13 of its potential returns per unit of risk. Jhancock Diversified Macro is currently generating about -0.1 per unit of risk. If you would invest 914.00 in Columbia Emerging Markets on September 3, 2024 and sell it today you would earn a total of 40.00 from holding Columbia Emerging Markets or generate 4.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.6% |
| Values | Daily Returns |
Columbia Emerging Markets vs. Jhancock Diversified Macro
Performance |
| Timeline |
| Columbia Emerging Markets |
| Jhancock Diversified |
Columbia Emerging and Jhancock Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Emerging and Jhancock Diversified
The main advantage of trading using opposite Columbia Emerging and Jhancock Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Emerging position performs unexpectedly, Jhancock Diversified 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 Jhancock Diversified will offset losses from the drop in Jhancock Diversified's long position.| Columbia Emerging vs. Jhancock Diversified Macro | Columbia Emerging vs. Adams Diversified Equity | Columbia Emerging vs. Delaware Limited Term Diversified | Columbia Emerging vs. Tax Managed Mid Small |
| Jhancock Diversified vs. Goldman Sachs Short | Jhancock Diversified vs. Angel Oak Ultrashort | Jhancock Diversified vs. Siit Ultra Short | Jhancock Diversified vs. Sterling Capital Short |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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