Correlation Between John Hancock and Artisan Developing
Can any of the company-specific risk be diversified away by investing in both John Hancock and Artisan Developing 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 Artisan Developing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Emerging and Artisan Developing World, you can compare the effects of market volatilities on John Hancock and Artisan Developing 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 Artisan Developing. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Artisan Developing.
Diversification Opportunities for John Hancock and Artisan Developing
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between John and Artisan is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Emerging and Artisan Developing World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Developing World 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 Emerging are associated (or correlated) with Artisan Developing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Developing World has no effect on the direction of John Hancock i.e., John Hancock and Artisan Developing go up and down completely randomly.
Pair Corralation between John Hancock and Artisan Developing
Assuming the 90 days horizon John Hancock Emerging is expected to generate 0.66 times more return on investment than Artisan Developing. However, John Hancock Emerging is 1.53 times less risky than Artisan Developing. It trades about -0.35 of its potential returns per unit of risk. Artisan Developing World is currently generating about -0.28 per unit of risk. If you would invest 992.00 in John Hancock Emerging on October 10, 2024 and sell it today you would lose (46.00) from holding John Hancock Emerging or give up 4.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Emerging vs. Artisan Developing World
Performance |
| Timeline |
| John Hancock Emerging |
| Artisan Developing World |
John Hancock and Artisan Developing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Artisan Developing
The main advantage of trading using opposite John Hancock and Artisan Developing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Artisan Developing 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 Artisan Developing will offset losses from the drop in Artisan Developing's long position.| John Hancock vs. Artisan High Income | John Hancock vs. Ab High Income | John Hancock vs. Lgm Risk Managed | John Hancock vs. Dunham High Yield |
| Artisan Developing vs. American Beacon Bridgeway | Artisan Developing vs. Baron Global Advantage | Artisan Developing vs. Matthews China Small | Artisan Developing vs. Artisan High Income |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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