Correlation Between PIMCO Investment and John Hancock
Can any of the company-specific risk be diversified away by investing in both PIMCO Investment and John Hancock 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 PIMCO Investment and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PIMCO Investment Grade and John Hancock Exchange Traded, you can compare the effects of market volatilities on PIMCO Investment and John Hancock 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 PIMCO Investment with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Investment and John Hancock.
Diversification Opportunities for PIMCO Investment and John Hancock
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between PIMCO and John is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Investment Grade and John Hancock Exchange Traded in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Exchange and PIMCO Investment 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 PIMCO Investment Grade are associated (or correlated) with John Hancock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Hancock Exchange has no effect on the direction of PIMCO Investment i.e., PIMCO Investment and John Hancock go up and down completely randomly.
Pair Corralation between PIMCO Investment and John Hancock
Given the investment horizon of 90 days PIMCO Investment Grade is expected to generate 0.97 times more return on investment than John Hancock. However, PIMCO Investment Grade is 1.03 times less risky than John Hancock. It trades about 0.08 of its potential returns per unit of risk. John Hancock Exchange Traded is currently generating about -0.03 per unit of risk. If you would invest 9,638 in PIMCO Investment Grade on August 27, 2024 and sell it today you would earn a total of 63.00 from holding PIMCO Investment Grade or generate 0.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PIMCO Investment Grade vs. John Hancock Exchange Traded
Performance |
| Timeline |
| PIMCO Investment Grade |
| John Hancock Exchange |
PIMCO Investment and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PIMCO Investment and John Hancock
The main advantage of trading using opposite PIMCO Investment and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO Investment position performs unexpectedly, John Hancock 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 John Hancock will offset losses from the drop in John Hancock's long position.| PIMCO Investment vs. PIMCO 0 5 Year | PIMCO Investment vs. iShares Aaa | PIMCO Investment vs. PIMCO Active Bond | PIMCO Investment vs. Invesco Fundamental High |
| John Hancock vs. John Hancock Exchange Traded | John Hancock vs. BlackRock Intermediate Muni | John Hancock vs. JPMorgan Short Duration | John Hancock vs. iShares BBB Rated |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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