Correlation Between Jhancock Diversified and Valic Company
Can any of the company-specific risk be diversified away by investing in both Jhancock Diversified and Valic Company 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 Valic Company 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 Valic Company I, you can compare the effects of market volatilities on Jhancock Diversified and Valic Company 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 Valic Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Diversified and Valic Company.
Diversification Opportunities for Jhancock Diversified and Valic Company
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jhancock and Valic is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Diversified Macro and Valic Company I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valic Company I 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 Valic Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valic Company I has no effect on the direction of Jhancock Diversified i.e., Jhancock Diversified and Valic Company go up and down completely randomly.
Pair Corralation between Jhancock Diversified and Valic Company
Assuming the 90 days horizon Jhancock Diversified is expected to generate 3.21 times less return on investment than Valic Company. But when comparing it to its historical volatility, Jhancock Diversified Macro is 1.22 times less risky than Valic Company. It trades about 0.05 of its potential returns per unit of risk. Valic Company I is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,037 in Valic Company I on November 3, 2024 and sell it today you would earn a total of 116.00 from holding Valic Company I or generate 11.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Diversified Macro vs. Valic Company I
Performance |
| Timeline |
| Jhancock Diversified |
| Valic Company I |
Jhancock Diversified and Valic Company Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Diversified and Valic Company
The main advantage of trading using opposite Jhancock Diversified and Valic Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Diversified position performs unexpectedly, Valic Company 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 Valic Company will offset losses from the drop in Valic Company's long position.| Jhancock Diversified vs. Vy Jpmorgan Emerging | Jhancock Diversified vs. Morgan Stanley Emerging | Jhancock Diversified vs. Mid Cap 15x Strategy | Jhancock Diversified vs. Siit Emerging Markets |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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