Correlation Between John Hancock and Victory Sycamore
Can any of the company-specific risk be diversified away by investing in both John Hancock and Victory Sycamore 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 Victory Sycamore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Bond and Victory Sycamore Small, you can compare the effects of market volatilities on John Hancock and Victory Sycamore 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 Victory Sycamore. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Victory Sycamore.
Diversification Opportunities for John Hancock and Victory Sycamore
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between John and Victory is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Bond and Victory Sycamore Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Victory Sycamore Small 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 Bond are associated (or correlated) with Victory Sycamore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Victory Sycamore Small has no effect on the direction of John Hancock i.e., John Hancock and Victory Sycamore go up and down completely randomly.
Pair Corralation between John Hancock and Victory Sycamore
Assuming the 90 days horizon John Hancock Bond is expected to generate 0.31 times more return on investment than Victory Sycamore. However, John Hancock Bond is 3.18 times less risky than Victory Sycamore. It trades about 0.27 of its potential returns per unit of risk. Victory Sycamore Small is currently generating about -0.1 per unit of risk. If you would invest 1,311 in John Hancock Bond on December 11, 2024 and sell it today you would earn a total of 44.00 from holding John Hancock Bond or generate 3.36% 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 Bond vs. Victory Sycamore Small
Performance |
| Timeline |
| John Hancock Bond |
| Victory Sycamore Small |
John Hancock and Victory Sycamore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Victory Sycamore
The main advantage of trading using opposite John Hancock and Victory Sycamore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Victory Sycamore 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 Victory Sycamore will offset losses from the drop in Victory Sycamore's long position.| John Hancock vs. John Hancock International | John Hancock vs. Mfs International Diversification | John Hancock vs. Mfs Growth Fund | John Hancock vs. Invesco Diversified Dividend |
| Victory Sycamore vs. Delaware Limited Term Diversified | Victory Sycamore vs. Stone Ridge Diversified | Victory Sycamore vs. Madison Diversified Income | Victory Sycamore vs. Blackrock Diversified Fixed |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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