Correlation Between John Hancock and Rationalpier
Can any of the company-specific risk be diversified away by investing in both John Hancock and Rationalpier 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 Rationalpier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Funds and Rationalpier 88 Convertible, you can compare the effects of market volatilities on John Hancock and Rationalpier 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 Rationalpier. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Rationalpier.
Diversification Opportunities for John Hancock and Rationalpier
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between John and Rationalpier is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Funds and Rationalpier 88 Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rationalpier 88 Conv 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 Funds are associated (or correlated) with Rationalpier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rationalpier 88 Conv has no effect on the direction of John Hancock i.e., John Hancock and Rationalpier go up and down completely randomly.
Pair Corralation between John Hancock and Rationalpier
Assuming the 90 days horizon John Hancock Funds is expected to generate 0.84 times more return on investment than Rationalpier. However, John Hancock Funds is 1.18 times less risky than Rationalpier. It trades about 0.18 of its potential returns per unit of risk. Rationalpier 88 Convertible is currently generating about 0.0 per unit of risk. If you would invest 1,426 in John Hancock Funds on September 13, 2024 and sell it today you would earn a total of 21.00 from holding John Hancock Funds or generate 1.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Funds vs. Rationalpier 88 Convertible
Performance |
| Timeline |
| John Hancock Funds |
| Rationalpier 88 Conv |
John Hancock and Rationalpier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Rationalpier
The main advantage of trading using opposite John Hancock and Rationalpier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Rationalpier 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 Rationalpier will offset losses from the drop in Rationalpier's long position.| John Hancock vs. Rationalpier 88 Convertible | John Hancock vs. Fidelity Sai Convertible | John Hancock vs. Absolute Convertible Arbitrage | John Hancock vs. Allianzgi Convertible Income |
| Rationalpier vs. Dodge Cox Stock | Rationalpier vs. Transamerica Large Cap | Rationalpier vs. American Mutual Fund | Rationalpier vs. Guidemark Large 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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