Correlation Between Jhancock Diversified and Parametric Emerging
Can any of the company-specific risk be diversified away by investing in both Jhancock Diversified and Parametric Emerging 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 Parametric Emerging 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 Parametric Emerging Markets, you can compare the effects of market volatilities on Jhancock Diversified and Parametric Emerging 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 Parametric Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Diversified and Parametric Emerging.
Diversification Opportunities for Jhancock Diversified and Parametric Emerging
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jhancock and Parametric is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Diversified Macro and Parametric Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parametric Emerging 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 Parametric Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parametric Emerging has no effect on the direction of Jhancock Diversified i.e., Jhancock Diversified and Parametric Emerging go up and down completely randomly.
Pair Corralation between Jhancock Diversified and Parametric Emerging
Assuming the 90 days horizon Jhancock Diversified is expected to generate 134.5 times less return on investment than Parametric Emerging. But when comparing it to its historical volatility, Jhancock Diversified Macro is 1.07 times less risky than Parametric Emerging. It trades about 0.0 of its potential returns per unit of risk. Parametric Emerging Markets is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,299 in Parametric Emerging Markets on September 3, 2024 and sell it today you would earn a total of 164.00 from holding Parametric Emerging Markets or generate 12.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Diversified Macro vs. Parametric Emerging Markets
Performance |
| Timeline |
| Jhancock Diversified |
| Parametric Emerging |
Jhancock Diversified and Parametric Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Diversified and Parametric Emerging
The main advantage of trading using opposite Jhancock Diversified and Parametric Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Diversified position performs unexpectedly, Parametric Emerging 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 Parametric Emerging will offset losses from the drop in Parametric Emerging's long position.| Jhancock Diversified vs. Goldman Sachs Short | Jhancock Diversified vs. Angel Oak Ultrashort | Jhancock Diversified vs. Siit Ultra Short | Jhancock Diversified vs. Sterling Capital Short |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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