Correlation Between First Eagle and John Hancock
Can any of the company-specific risk be diversified away by investing in both First Eagle 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 First Eagle and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Eagle Global and John Hancock Bond, you can compare the effects of market volatilities on First Eagle 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 First Eagle with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and John Hancock.
Diversification Opportunities for First Eagle and John Hancock
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and John is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and John Hancock Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Bond and First Eagle 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 First Eagle Global 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 Bond has no effect on the direction of First Eagle i.e., First Eagle and John Hancock go up and down completely randomly.
Pair Corralation between First Eagle and John Hancock
Assuming the 90 days horizon First Eagle Global is expected to under-perform the John Hancock. In addition to that, First Eagle is 1.34 times more volatile than John Hancock Bond. It trades about -0.22 of its total potential returns per unit of risk. John Hancock Bond is currently generating about 0.12 per unit of volatility. If you would invest 1,354 in John Hancock Bond on September 12, 2024 and sell it today you would earn a total of 10.00 from holding John Hancock Bond or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Global vs. John Hancock Bond
Performance |
| Timeline |
| First Eagle Global |
| John Hancock Bond |
First Eagle and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and John Hancock
The main advantage of trading using opposite First Eagle and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle 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.| First Eagle vs. Dreyfusstandish Global Fixed | First Eagle vs. Pace High Yield | First Eagle vs. Blrc Sgy Mnp | First Eagle vs. Ishares Municipal Bond |
| John Hancock vs. Metropolitan West Total | John Hancock vs. SCOR PK | John Hancock vs. Morningstar Unconstrained Allocation | John Hancock vs. Thrivent High Yield |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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