Correlation Between Jhancock Global and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Jhancock Global and Emerging Markets 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 Global and Emerging Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jhancock Global Equity and The Emerging Markets, you can compare the effects of market volatilities on Jhancock Global and Emerging Markets 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 Global with a short position of Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Global and Emerging Markets.
Diversification Opportunities for Jhancock Global and Emerging Markets
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jhancock and Emerging is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Global Equity and The Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets and Jhancock Global 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 Global Equity are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets has no effect on the direction of Jhancock Global i.e., Jhancock Global and Emerging Markets go up and down completely randomly.
Pair Corralation between Jhancock Global and Emerging Markets
Assuming the 90 days horizon Jhancock Global Equity is expected to generate 0.72 times more return on investment than Emerging Markets. However, Jhancock Global Equity is 1.39 times less risky than Emerging Markets. It trades about 0.07 of its potential returns per unit of risk. The Emerging Markets is currently generating about 0.03 per unit of risk. If you would invest 1,171 in Jhancock Global Equity on September 12, 2024 and sell it today you would earn a total of 187.00 from holding Jhancock Global Equity or generate 15.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Global Equity vs. The Emerging Markets
Performance |
| Timeline |
| Jhancock Global Equity |
| Emerging Markets |
Jhancock Global and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Global and Emerging Markets
The main advantage of trading using opposite Jhancock Global and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Global position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Jhancock Global vs. John Hancock Financial | Jhancock Global vs. Blackrock Financial Institutions | Jhancock Global vs. Angel Oak Financial | Jhancock Global vs. Icon Financial Fund |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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