Correlation Between John Hancock and JPMorgan Diversified
Can any of the company-specific risk be diversified away by investing in both John Hancock and JPMorgan Diversified 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 Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Multifactor and JPMorgan Diversified Return, you can compare the effects of market volatilities on John Hancock and JPMorgan Diversified 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 Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and JPMorgan Diversified.
Diversification Opportunities for John Hancock and JPMorgan Diversified
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between John and JPMorgan is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Multifactor and JPMorgan Diversified Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Diversified 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 Multifactor are associated (or correlated) with JPMorgan Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Diversified has no effect on the direction of John Hancock i.e., John Hancock and JPMorgan Diversified go up and down completely randomly.
Pair Corralation between John Hancock and JPMorgan Diversified
Given the investment horizon of 90 days John Hancock Multifactor is expected to generate 1.12 times more return on investment than JPMorgan Diversified. However, John Hancock is 1.12 times more volatile than JPMorgan Diversified Return. It trades about 0.38 of its potential returns per unit of risk. JPMorgan Diversified Return is currently generating about 0.34 per unit of risk. If you would invest 6,881 in John Hancock Multifactor on September 4, 2024 and sell it today you would earn a total of 441.00 from holding John Hancock Multifactor or generate 6.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Multifactor vs. JPMorgan Diversified Return
Performance |
| Timeline |
| John Hancock Multifactor |
| JPMorgan Diversified |
John Hancock and JPMorgan Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and JPMorgan Diversified
The main advantage of trading using opposite John Hancock and JPMorgan Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, JPMorgan Diversified 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 Diversified will offset losses from the drop in JPMorgan Diversified's long position.| John Hancock vs. Vanguard Total Stock | John Hancock vs. SPDR SP 500 | John Hancock vs. iShares Core SP | John Hancock vs. Vanguard Dividend Appreciation |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |