Correlation Between John Hancock and Deutsche Short-term
Can any of the company-specific risk be diversified away by investing in both John Hancock and Deutsche Short-term 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 Deutsche Short-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Investment and Deutsche Short Term Municipal, you can compare the effects of market volatilities on John Hancock and Deutsche Short-term 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 Deutsche Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Deutsche Short-term.
Diversification Opportunities for John Hancock and Deutsche Short-term
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between John and Deutsche is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Investment and Deutsche Short Term Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Short Term 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 Investment are associated (or correlated) with Deutsche Short-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Short Term has no effect on the direction of John Hancock i.e., John Hancock and Deutsche Short-term go up and down completely randomly.
Pair Corralation between John Hancock and Deutsche Short-term
Assuming the 90 days horizon John Hancock Investment is expected to generate 9.6 times more return on investment than Deutsche Short-term. However, John Hancock is 9.6 times more volatile than Deutsche Short Term Municipal. It trades about 0.11 of its potential returns per unit of risk. Deutsche Short Term Municipal is currently generating about 0.2 per unit of risk. If you would invest 7,082 in John Hancock Investment on September 3, 2024 and sell it today you would earn a total of 1,170 from holding John Hancock Investment or generate 16.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Investment vs. Deutsche Short Term Municipal
Performance |
| Timeline |
| John Hancock Investment |
| Deutsche Short Term |
John Hancock and Deutsche Short-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Deutsche Short-term
The main advantage of trading using opposite John Hancock and Deutsche Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Deutsche Short-term 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 Deutsche Short-term will offset losses from the drop in Deutsche Short-term's long position.| John Hancock vs. Calamos Dynamic Convertible | John Hancock vs. Limited Term Tax | John Hancock vs. Touchstone Premium Yield | John Hancock vs. Versatile Bond Portfolio |
| Deutsche Short-term vs. Tax Exempt Bond | Deutsche Short-term vs. American High Income Municipal | Deutsche Short-term vs. Us Government Securities | Deutsche Short-term vs. HUMANA INC |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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