Correlation Between Guidepath(r) Managed and Jhancock Diversified
Can any of the company-specific risk be diversified away by investing in both Guidepath(r) Managed and Jhancock Diversified 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 Guidepath(r) Managed and Jhancock Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidepath Managed Futures and Jhancock Diversified Macro, you can compare the effects of market volatilities on Guidepath(r) Managed and Jhancock Diversified 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 Guidepath(r) Managed with a short position of Jhancock Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidepath(r) Managed and Jhancock Diversified.
Diversification Opportunities for Guidepath(r) Managed and Jhancock Diversified
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guidepath(r) and Jhancock is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Guidepath Managed Futures and Jhancock Diversified Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Diversified and Guidepath(r) Managed 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 Guidepath Managed Futures are associated (or correlated) with Jhancock Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Diversified has no effect on the direction of Guidepath(r) Managed i.e., Guidepath(r) Managed and Jhancock Diversified go up and down completely randomly.
Pair Corralation between Guidepath(r) Managed and Jhancock Diversified
Assuming the 90 days horizon Guidepath Managed Futures is expected to under-perform the Jhancock Diversified. In addition to that, Guidepath(r) Managed is 1.4 times more volatile than Jhancock Diversified Macro. It trades about -0.02 of its total potential returns per unit of risk. Jhancock Diversified Macro is currently generating about 0.01 per unit of volatility. If you would invest 906.00 in Jhancock Diversified Macro on October 16, 2024 and sell it today you would earn a total of 10.00 from holding Jhancock Diversified Macro or generate 1.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidepath Managed Futures vs. Jhancock Diversified Macro
Performance |
| Timeline |
| Guidepath Managed Futures |
| Jhancock Diversified |
Guidepath(r) Managed and Jhancock Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidepath(r) Managed and Jhancock Diversified
The main advantage of trading using opposite Guidepath(r) Managed and Jhancock Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidepath(r) Managed position performs unexpectedly, Jhancock Diversified 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 Jhancock Diversified will offset losses from the drop in Jhancock Diversified's long position.| Guidepath(r) Managed vs. Needham Aggressive Growth | Guidepath(r) Managed vs. Virtus High Yield | Guidepath(r) Managed vs. Gmo High Yield | Guidepath(r) Managed vs. Multi Manager High Yield |
| Jhancock Diversified vs. Atac Inflation Rotation | Jhancock Diversified vs. Guidepath Managed Futures | Jhancock Diversified vs. Fidelity Sai Inflationfocused | Jhancock Diversified vs. Ab Bond Inflation |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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