Correlation Between Jhancock Diversified and Brandes International
Can any of the company-specific risk be diversified away by investing in both Jhancock Diversified and Brandes International 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 Jhancock Diversified and Brandes International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jhancock Diversified Macro and Brandes International Equity, you can compare the effects of market volatilities on Jhancock Diversified and Brandes International 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 Jhancock Diversified with a short position of Brandes International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Diversified and Brandes International.
Diversification Opportunities for Jhancock Diversified and Brandes International
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jhancock and Brandes is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Diversified Macro and Brandes International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandes International and Jhancock Diversified 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 Jhancock Diversified Macro are associated (or correlated) with Brandes International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandes International has no effect on the direction of Jhancock Diversified i.e., Jhancock Diversified and Brandes International go up and down completely randomly.
Pair Corralation between Jhancock Diversified and Brandes International
Assuming the 90 days horizon Jhancock Diversified Macro is expected to generate 1.02 times more return on investment than Brandes International. However, Jhancock Diversified is 1.02 times more volatile than Brandes International Equity. It trades about 0.23 of its potential returns per unit of risk. Brandes International Equity is currently generating about -0.07 per unit of risk. If you would invest 889.00 in Jhancock Diversified Macro on September 12, 2024 and sell it today you would earn a total of 22.00 from holding Jhancock Diversified Macro or generate 2.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Jhancock Diversified Macro vs. Brandes International Equity
Performance |
| Timeline |
| Jhancock Diversified |
| Brandes International |
Jhancock Diversified and Brandes International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Diversified and Brandes International
The main advantage of trading using opposite Jhancock Diversified and Brandes International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Diversified position performs unexpectedly, Brandes International 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 Brandes International will offset losses from the drop in Brandes International's long position.| Jhancock Diversified vs. Sentinel Small Pany | Jhancock Diversified vs. Blackrock Sm Cap | Jhancock Diversified vs. Tiaa Cref Small Cap Blend | Jhancock Diversified vs. Davenport Small Cap |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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