Correlation Between IShares MSCI and John Hancock
Can any of the company-specific risk be diversified away by investing in both IShares MSCI 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 IShares MSCI and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares MSCI EAFE and John Hancock Exchange Traded, you can compare the effects of market volatilities on IShares MSCI 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 IShares MSCI with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and John Hancock.
Diversification Opportunities for IShares MSCI and John Hancock
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IShares and John is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI EAFE 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 IShares MSCI 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 iShares MSCI EAFE 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 IShares MSCI i.e., IShares MSCI and John Hancock go up and down completely randomly.
Pair Corralation between IShares MSCI and John Hancock
Considering the 90-day investment horizon iShares MSCI EAFE is expected to under-perform the John Hancock. But the etf apears to be less risky and, when comparing its historical volatility, iShares MSCI EAFE is 1.05 times less risky than John Hancock. The etf trades about -0.2 of its potential returns per unit of risk. The John Hancock Exchange Traded is currently generating about -0.17 of returns per unit of risk over similar time horizon. If you would invest 3,028 in John Hancock Exchange Traded on August 30, 2024 and sell it today you would lose (165.00) from holding John Hancock Exchange Traded or give up 5.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares MSCI EAFE vs. John Hancock Exchange Traded
Performance |
| Timeline |
| iShares MSCI EAFE |
| John Hancock Exchange |
IShares MSCI and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and John Hancock
The main advantage of trading using opposite IShares MSCI and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI 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.| IShares MSCI vs. iShares MSCI EAFE | IShares MSCI vs. iShares MSCI EAFE | IShares MSCI vs. WisdomTree International SmallCap | IShares MSCI vs. iShares Russell Mid Cap |
| John Hancock vs. Freedom Day Dividend | John Hancock vs. Franklin Templeton ETF | John Hancock vs. iShares MSCI China | John Hancock vs. Tidal Trust II |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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