Correlation Between John Hancock and Nuveen Limited
Can any of the company-specific risk be diversified away by investing in both John Hancock and Nuveen Limited 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 Nuveen Limited into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Global and Nuveen Limited Term, you can compare the effects of market volatilities on John Hancock and Nuveen Limited 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 Nuveen Limited. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Nuveen Limited.
Diversification Opportunities for John Hancock and Nuveen Limited
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between John and Nuveen is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Global and Nuveen Limited Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Limited Term 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 Global are associated (or correlated) with Nuveen Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Limited Term has no effect on the direction of John Hancock i.e., John Hancock and Nuveen Limited go up and down completely randomly.
Pair Corralation between John Hancock and Nuveen Limited
Assuming the 90 days horizon John Hancock Global is expected to generate 2.4 times more return on investment than Nuveen Limited. However, John Hancock is 2.4 times more volatile than Nuveen Limited Term. It trades about 0.2 of its potential returns per unit of risk. Nuveen Limited Term is currently generating about 0.23 per unit of risk. If you would invest 1,236 in John Hancock Global on September 1, 2024 and sell it today you would earn a total of 26.00 from holding John Hancock Global or generate 2.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Global vs. Nuveen Limited Term
Performance |
| Timeline |
| John Hancock Global |
| Nuveen Limited Term |
John Hancock and Nuveen Limited Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Nuveen Limited
The main advantage of trading using opposite John Hancock and Nuveen Limited positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Nuveen Limited 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 Nuveen Limited will offset losses from the drop in Nuveen Limited'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 |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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