Correlation Between John Hancock and Dunham Real
Can any of the company-specific risk be diversified away by investing in both John Hancock and Dunham Real 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 John Hancock and Dunham Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Variable and Dunham Real Estate, you can compare the effects of market volatilities on John Hancock and Dunham Real 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 John Hancock with a short position of Dunham Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Dunham Real.
Diversification Opportunities for John Hancock and Dunham Real
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between John and Dunham is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Variable and Dunham Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Real Estate and John Hancock 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 John Hancock Variable are associated (or correlated) with Dunham Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Real Estate has no effect on the direction of John Hancock i.e., John Hancock and Dunham Real go up and down completely randomly.
Pair Corralation between John Hancock and Dunham Real
Assuming the 90 days horizon John Hancock Variable is expected to generate about the same return on investment as Dunham Real Estate. But, John Hancock Variable is 1.12 times less risky than Dunham Real. It trades about 0.11 of its potential returns per unit of risk. Dunham Real Estate is currently generating about 0.1 per unit of risk. If you would invest 1,146 in Dunham Real Estate on September 1, 2024 and sell it today you would earn a total of 390.00 from holding Dunham Real Estate or generate 34.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Variable vs. Dunham Real Estate
Performance |
| Timeline |
| John Hancock Variable |
| Dunham Real Estate |
John Hancock and Dunham Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Dunham Real
The main advantage of trading using opposite John Hancock and Dunham Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Dunham Real 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 Dunham Real will offset losses from the drop in Dunham Real's long position.| John Hancock vs. Pace Municipal Fixed | John Hancock vs. T Rowe Price | John Hancock vs. Old Westbury Municipal | John Hancock vs. T Rowe Price |
| Dunham Real vs. Growth Opportunities Fund | Dunham Real vs. Nasdaq 100 Index Fund | Dunham Real vs. Eic Value Fund | Dunham Real vs. Auer Growth Fund |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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