Correlation Between Janus Henderson and Henderson European
Can any of the company-specific risk be diversified away by investing in both Janus Henderson and Henderson European 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 Janus Henderson and Henderson European into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Janus Henderson European and Henderson European Focus, you can compare the effects of market volatilities on Janus Henderson and Henderson European 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 Janus Henderson with a short position of Henderson European. Check out your portfolio center. Please also check ongoing floating volatility patterns of Janus Henderson and Henderson European.
Diversification Opportunities for Janus Henderson and Henderson European
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Janus and Henderson is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Janus Henderson European and Henderson European Focus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henderson European Focus and Janus Henderson 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 Janus Henderson European are associated (or correlated) with Henderson European. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henderson European Focus has no effect on the direction of Janus Henderson i.e., Janus Henderson and Henderson European go up and down completely randomly.
Pair Corralation between Janus Henderson and Henderson European
Assuming the 90 days horizon Janus Henderson European is expected to under-perform the Henderson European. But the mutual fund apears to be less risky and, when comparing its historical volatility, Janus Henderson European is 1.01 times less risky than Henderson European. The mutual fund trades about -0.19 of its potential returns per unit of risk. The Henderson European Focus is currently generating about -0.19 of returns per unit of risk over similar time horizon. If you would invest 4,753 in Henderson European Focus on August 30, 2024 and sell it today you would lose (186.00) from holding Henderson European Focus or give up 3.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Janus Henderson European vs. Henderson European Focus
Performance |
| Timeline |
| Janus Henderson European |
| Henderson European Focus |
Janus Henderson and Henderson European Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Janus Henderson and Henderson European
The main advantage of trading using opposite Janus Henderson and Henderson European positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Janus Henderson position performs unexpectedly, Henderson European 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 Henderson European will offset losses from the drop in Henderson European's long position.| Janus Henderson vs. Invesco European Small | Janus Henderson vs. Henderson European Focus | Janus Henderson vs. Invesco European Growth | Janus Henderson vs. Aquagold International |
| Henderson European vs. Henderson Global Equity | Henderson European vs. Loomis Sayles Strategic | Henderson European vs. First Eagle Overseas | Henderson European vs. Henderson European Focus |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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