Correlation Between Forum Real and John Hancock
Can any of the company-specific risk be diversified away by investing in both Forum Real 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 Forum Real and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forum Real Estate and John Hancock Variable, you can compare the effects of market volatilities on Forum Real 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 Forum Real with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forum Real and John Hancock.
Diversification Opportunities for Forum Real and John Hancock
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Forum and John is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Forum Real Estate and John Hancock Variable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Variable and Forum Real 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 Forum Real Estate 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 Variable has no effect on the direction of Forum Real i.e., Forum Real and John Hancock go up and down completely randomly.
Pair Corralation between Forum Real and John Hancock
Assuming the 90 days horizon Forum Real is expected to generate 2.36 times less return on investment than John Hancock. But when comparing it to its historical volatility, Forum Real Estate is 10.0 times less risky than John Hancock. It trades about 0.48 of its potential returns per unit of risk. John Hancock Variable is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,655 in John Hancock Variable on September 1, 2024 and sell it today you would earn a total of 571.00 from holding John Hancock Variable or generate 34.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forum Real Estate vs. John Hancock Variable
Performance |
| Timeline |
| Forum Real Estate |
| John Hancock Variable |
Forum Real and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forum Real and John Hancock
The main advantage of trading using opposite Forum Real and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forum Real 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.| Forum Real vs. The Hartford Healthcare | Forum Real vs. Invesco Global Health | Forum Real vs. Allianzgi Health Sciences | Forum Real vs. Fidelity Advisor Health |
| John Hancock vs. Pace Municipal Fixed | John Hancock vs. T Rowe Price | John Hancock vs. Old Westbury Municipal | John Hancock vs. T Rowe Price |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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