Correlation Between John Hancock and Pacific Funds
Can any of the company-specific risk be diversified away by investing in both John Hancock and Pacific Funds 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 Pacific Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Government and Pacific Funds Strategic, you can compare the effects of market volatilities on John Hancock and Pacific Funds 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 Pacific Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Pacific Funds.
Diversification Opportunities for John Hancock and Pacific Funds
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between John and Pacific is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Government and Pacific Funds Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacific Funds Strategic 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 Government are associated (or correlated) with Pacific Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacific Funds Strategic has no effect on the direction of John Hancock i.e., John Hancock and Pacific Funds go up and down completely randomly.
Pair Corralation between John Hancock and Pacific Funds
Assuming the 90 days horizon John Hancock Government is expected to generate 2.0 times more return on investment than Pacific Funds. However, John Hancock is 2.0 times more volatile than Pacific Funds Strategic. It trades about 0.09 of its potential returns per unit of risk. Pacific Funds Strategic is currently generating about 0.15 per unit of risk. If you would invest 781.00 in John Hancock Government on September 4, 2024 and sell it today you would earn a total of 5.00 from holding John Hancock Government or generate 0.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
John Hancock Government vs. Pacific Funds Strategic
Performance |
| Timeline |
| John Hancock Government |
| Pacific Funds Strategic |
John Hancock and Pacific Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Pacific Funds
The main advantage of trading using opposite John Hancock and Pacific Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Pacific Funds 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 Pacific Funds will offset losses from the drop in Pacific Funds' long position.| John Hancock vs. Regional Bank Fund | John Hancock vs. Regional Bank Fund | John Hancock vs. Multimanager Lifestyle Moderate | John Hancock vs. Multimanager Lifestyle Balanced |
| Pacific Funds vs. T Rowe Price | Pacific Funds vs. Harbor Diversified International | Pacific Funds vs. Small Cap Stock | Pacific Funds vs. Wasatch Small Cap |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |