Correlation Between Fidelity Real and John Hancock
Can any of the company-specific risk be diversified away by investing in both Fidelity 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 Fidelity 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 Fidelity Real Estate and John Hancock Financial, you can compare the effects of market volatilities on Fidelity 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 Fidelity Real with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Real and John Hancock.
Diversification Opportunities for Fidelity Real and John Hancock
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidelity and John is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Real Estate and John Hancock Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Financial and Fidelity 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 Fidelity 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 Financial has no effect on the direction of Fidelity Real i.e., Fidelity Real and John Hancock go up and down completely randomly.
Pair Corralation between Fidelity Real and John Hancock
Assuming the 90 days horizon Fidelity Real Estate is expected to generate 0.23 times more return on investment than John Hancock. However, Fidelity Real Estate is 4.41 times less risky than John Hancock. It trades about 0.09 of its potential returns per unit of risk. John Hancock Financial is currently generating about -0.06 per unit of risk. If you would invest 1,216 in Fidelity Real Estate on September 14, 2024 and sell it today you would earn a total of 5.00 from holding Fidelity Real Estate or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Real Estate vs. John Hancock Financial
Performance |
| Timeline |
| Fidelity Real Estate |
| John Hancock Financial |
Fidelity Real and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Real and John Hancock
The main advantage of trading using opposite Fidelity Real and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity 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.| Fidelity Real vs. John Hancock Financial | Fidelity Real vs. Transamerica Financial Life | Fidelity Real vs. Davis Financial Fund | Fidelity Real vs. 1919 Financial Services |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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