Correlation Between John Hancock and ClimateRock
Can any of the company-specific risk be diversified away by investing in both John Hancock and ClimateRock 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 ClimateRock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Investors and ClimateRock Class A, you can compare the effects of market volatilities on John Hancock and ClimateRock 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 ClimateRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and ClimateRock.
Diversification Opportunities for John Hancock and ClimateRock
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between John and ClimateRock is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Investors and ClimateRock Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ClimateRock Class 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 Investors are associated (or correlated) with ClimateRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ClimateRock Class has no effect on the direction of John Hancock i.e., John Hancock and ClimateRock go up and down completely randomly.
Pair Corralation between John Hancock and ClimateRock
Considering the 90-day investment horizon John Hancock Investors is expected to generate 0.27 times more return on investment than ClimateRock. However, John Hancock Investors is 3.72 times less risky than ClimateRock. It trades about 0.19 of its potential returns per unit of risk. ClimateRock Class A is currently generating about 0.0 per unit of risk. If you would invest 1,399 in John Hancock Investors on November 28, 2024 and sell it today you would earn a total of 12.00 from holding John Hancock Investors or generate 0.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
John Hancock Investors vs. ClimateRock Class A
Performance |
| Timeline |
| John Hancock Investors |
| ClimateRock Class |
John Hancock and ClimateRock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and ClimateRock
The main advantage of trading using opposite John Hancock and ClimateRock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, ClimateRock 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 ClimateRock will offset losses from the drop in ClimateRock's long position.| John Hancock vs. DTF Tax Free | John Hancock vs. MFS Investment Grade | John Hancock vs. Eaton Vance National | John Hancock vs. Nuveen California Select |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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