Correlation Between Jhancock Global and Western Asset
Can any of the company-specific risk be diversified away by investing in both Jhancock Global and Western Asset 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 Western Asset 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 Western Asset Short Term, you can compare the effects of market volatilities on Jhancock Global and Western Asset 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 Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Global and Western Asset.
Diversification Opportunities for Jhancock Global and Western Asset
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jhancock and Western is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Global Equity and Western Asset Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Short 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 Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Short has no effect on the direction of Jhancock Global i.e., Jhancock Global and Western Asset go up and down completely randomly.
Pair Corralation between Jhancock Global and Western Asset
Assuming the 90 days horizon Jhancock Global Equity is expected to generate 3.95 times more return on investment than Western Asset. However, Jhancock Global is 3.95 times more volatile than Western Asset Short Term. It trades about 0.03 of its potential returns per unit of risk. Western Asset Short Term is currently generating about 0.12 per unit of risk. If you would invest 1,359 in Jhancock Global Equity on September 13, 2024 and sell it today you would earn a total of 4.00 from holding Jhancock Global Equity or generate 0.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Global Equity vs. Western Asset Short Term
Performance |
| Timeline |
| Jhancock Global Equity |
| Western Asset Short |
Jhancock Global and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Global and Western Asset
The main advantage of trading using opposite Jhancock Global and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Global position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Jhancock Global vs. Morningstar Global Income | Jhancock Global vs. Franklin Mutual Global | Jhancock Global vs. Ab Global Real |
| Western Asset vs. Clearbridge Aggressive Growth | Western Asset vs. Clearbridge Small Cap | Western Asset vs. Qs International Equity | Western Asset vs. Clearbridge Appreciation Fund |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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