Correlation Between John Hancock and Jpmorgan Equity
Can any of the company-specific risk be diversified away by investing in both John Hancock and Jpmorgan Equity 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 Jpmorgan Equity 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 Jpmorgan Equity Income, you can compare the effects of market volatilities on John Hancock and Jpmorgan Equity 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 Jpmorgan Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Jpmorgan Equity.
Diversification Opportunities for John Hancock and Jpmorgan Equity
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JOHN and Jpmorgan is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Bond and Jpmorgan Equity Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Equity Income 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 Jpmorgan Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Equity Income has no effect on the direction of John Hancock i.e., John Hancock and Jpmorgan Equity go up and down completely randomly.
Pair Corralation between John Hancock and Jpmorgan Equity
Assuming the 90 days horizon John Hancock is expected to generate 16.2 times less return on investment than Jpmorgan Equity. But when comparing it to its historical volatility, John Hancock Bond is 2.25 times less risky than Jpmorgan Equity. It trades about 0.05 of its potential returns per unit of risk. Jpmorgan Equity Income is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 2,389 in Jpmorgan Equity Income on November 3, 2024 and sell it today you would earn a total of 121.00 from holding Jpmorgan Equity Income or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Bond vs. Jpmorgan Equity Income
Performance |
| Timeline |
| John Hancock Bond |
| Jpmorgan Equity Income |
John Hancock and Jpmorgan Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Jpmorgan Equity
The main advantage of trading using opposite John Hancock and Jpmorgan Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Jpmorgan Equity 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 Jpmorgan Equity will offset losses from the drop in Jpmorgan Equity's long position.| John Hancock vs. Ambrus Core Bond | John Hancock vs. Old Westbury California | John Hancock vs. Ab Bond Inflation | John Hancock vs. Rbc Bluebay Emerging |
| Jpmorgan Equity vs. Mfs International Diversification | Jpmorgan Equity vs. Franklin Dynatech Fund | Jpmorgan Equity vs. Prudential Total Return | Jpmorgan Equity vs. John Hancock Bond |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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