Correlation Between John Hancock and Wellington Shields
Can any of the company-specific risk be diversified away by investing in both John Hancock and Wellington Shields 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 Wellington Shields 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 Wellington Shields All Cap, you can compare the effects of market volatilities on John Hancock and Wellington Shields 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 Wellington Shields. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Wellington Shields.
Diversification Opportunities for John Hancock and Wellington Shields
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between John and Wellington is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Government and Wellington Shields All Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wellington Shields All 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 Wellington Shields. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wellington Shields All has no effect on the direction of John Hancock i.e., John Hancock and Wellington Shields go up and down completely randomly.
Pair Corralation between John Hancock and Wellington Shields
Assuming the 90 days horizon John Hancock is expected to generate 16.04 times less return on investment than Wellington Shields. But when comparing it to its historical volatility, John Hancock Government is 2.11 times less risky than Wellington Shields. It trades about 0.01 of its potential returns per unit of risk. Wellington Shields All Cap is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2,113 in Wellington Shields All Cap on August 31, 2024 and sell it today you would earn a total of 876.00 from holding Wellington Shields All Cap or generate 41.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Government vs. Wellington Shields All Cap
Performance |
| Timeline |
| John Hancock Government |
| Wellington Shields All |
John Hancock and Wellington Shields Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Wellington Shields
The main advantage of trading using opposite John Hancock and Wellington Shields positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Wellington Shields 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 Wellington Shields will offset losses from the drop in Wellington Shields' long position.| John Hancock vs. International Investors Gold | John Hancock vs. Franklin Gold Precious | John Hancock vs. Short Precious Metals | John Hancock vs. Precious Metals And |
| Wellington Shields vs. Dws Government Money | Wellington Shields vs. Us Government Securities | Wellington Shields vs. John Hancock Government | Wellington Shields vs. Us Government Plus |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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