Correlation Between John Hancock and Vanguard Multi-sector
Can any of the company-specific risk be diversified away by investing in both John Hancock and Vanguard Multi-sector 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 Vanguard Multi-sector 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 Vanguard Multi Sector Income, you can compare the effects of market volatilities on John Hancock and Vanguard Multi-sector 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 Vanguard Multi-sector. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Vanguard Multi-sector.
Diversification Opportunities for John Hancock and Vanguard Multi-sector
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between John and Vanguard is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Government and Vanguard Multi Sector Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Multi Sector 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 Vanguard Multi-sector. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Multi Sector has no effect on the direction of John Hancock i.e., John Hancock and Vanguard Multi-sector go up and down completely randomly.
Pair Corralation between John Hancock and Vanguard Multi-sector
Assuming the 90 days horizon John Hancock is expected to generate 1.02 times less return on investment than Vanguard Multi-sector. In addition to that, John Hancock is 1.58 times more volatile than Vanguard Multi Sector Income. It trades about 0.09 of its total potential returns per unit of risk. Vanguard Multi Sector Income is currently generating about 0.14 per unit of volatility. If you would invest 905.00 in Vanguard Multi Sector Income on September 4, 2024 and sell it today you would earn a total of 6.00 from holding Vanguard Multi Sector Income or generate 0.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Government vs. Vanguard Multi Sector Income
Performance |
| Timeline |
| John Hancock Government |
| Vanguard Multi Sector |
John Hancock and Vanguard Multi-sector Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Vanguard Multi-sector
The main advantage of trading using opposite John Hancock and Vanguard Multi-sector positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Vanguard Multi-sector 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 Vanguard Multi-sector will offset losses from the drop in Vanguard Multi-sector's 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 |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |