Correlation Between Goehring Rozencwajg and John Hancock
Can any of the company-specific risk be diversified away by investing in both Goehring Rozencwajg 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 Goehring Rozencwajg and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goehring Rozencwajg Resources and John Hancock Global, you can compare the effects of market volatilities on Goehring Rozencwajg 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 Goehring Rozencwajg with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goehring Rozencwajg and John Hancock.
Diversification Opportunities for Goehring Rozencwajg and John Hancock
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Goehring and John is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Goehring Rozencwajg Resources and John Hancock Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Global and Goehring Rozencwajg 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 Goehring Rozencwajg Resources 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 Global has no effect on the direction of Goehring Rozencwajg i.e., Goehring Rozencwajg and John Hancock go up and down completely randomly.
Pair Corralation between Goehring Rozencwajg and John Hancock
Assuming the 90 days horizon Goehring Rozencwajg Resources is expected to under-perform the John Hancock. In addition to that, Goehring Rozencwajg is 2.41 times more volatile than John Hancock Global. It trades about -0.14 of its total potential returns per unit of risk. John Hancock Global is currently generating about -0.21 per unit of volatility. If you would invest 1,186 in John Hancock Global on October 7, 2024 and sell it today you would lose (39.00) from holding John Hancock Global or give up 3.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goehring Rozencwajg Resources vs. John Hancock Global
Performance |
| Timeline |
| Goehring Rozencwajg |
| John Hancock Global |
Goehring Rozencwajg and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goehring Rozencwajg and John Hancock
The main advantage of trading using opposite Goehring Rozencwajg and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goehring Rozencwajg 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.| Goehring Rozencwajg vs. Praxis Small Cap | Goehring Rozencwajg vs. Champlain Small | Goehring Rozencwajg vs. Smallcap Fund Fka | Goehring Rozencwajg vs. Franklin Small Cap |
| John Hancock vs. Franklin Mutual Global | John Hancock vs. Dodge Global Stock | John Hancock vs. Franklin Mutual Global | 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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