Correlation Between John Hancock and Optimize Strategy
Can any of the company-specific risk be diversified away by investing in both John Hancock and Optimize Strategy 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 Optimize Strategy 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 Optimize Strategy Index, you can compare the effects of market volatilities on John Hancock and Optimize Strategy 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 Optimize Strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Optimize Strategy.
Diversification Opportunities for John Hancock and Optimize Strategy
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between John and Optimize is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Multifactor and Optimize Strategy Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optimize Strategy Index 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 Optimize Strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optimize Strategy Index has no effect on the direction of John Hancock i.e., John Hancock and Optimize Strategy go up and down completely randomly.
Pair Corralation between John Hancock and Optimize Strategy
Given the investment horizon of 90 days John Hancock is expected to generate 1.27 times less return on investment than Optimize Strategy. But when comparing it to its historical volatility, John Hancock Multifactor is 1.14 times less risky than Optimize Strategy. It trades about 0.09 of its potential returns per unit of risk. Optimize Strategy Index is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,526 in Optimize Strategy Index on November 9, 2024 and sell it today you would earn a total of 536.00 from holding Optimize Strategy Index or generate 21.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 74.53% |
| Values | Daily Returns |
John Hancock Multifactor vs. Optimize Strategy Index
Performance |
| Timeline |
| John Hancock Multifactor |
| Optimize Strategy Index |
John Hancock and Optimize Strategy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Optimize Strategy
The main advantage of trading using opposite John Hancock and Optimize Strategy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Optimize Strategy 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 Optimize Strategy will offset losses from the drop in Optimize Strategy's long position.| John Hancock vs. John Hancock Multifactor | John Hancock vs. JPMorgan Diversified Return | John Hancock vs. JPMorgan Diversified Return | John Hancock vs. JPMorgan Diversified Return |
| Optimize Strategy vs. Freedom Day Dividend | Optimize Strategy vs. Franklin Templeton ETF | Optimize Strategy vs. iShares MSCI China | Optimize Strategy vs. Tidal Trust II |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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