Correlation Between J Hancock and Us Global
Can any of the company-specific risk be diversified away by investing in both J Hancock and Us Global 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 J Hancock and Us Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J Hancock Ii and Us Global Leaders, you can compare the effects of market volatilities on J Hancock and Us Global 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 J Hancock with a short position of Us Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Hancock and Us Global.
Diversification Opportunities for J Hancock and Us Global
Very poor diversification
The 3 months correlation between JRETX and USGLX is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding J Hancock Ii and Us Global Leaders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Us Global Leaders and J 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 J Hancock Ii are associated (or correlated) with Us Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Us Global Leaders has no effect on the direction of J Hancock i.e., J Hancock and Us Global go up and down completely randomly.
Pair Corralation between J Hancock and Us Global
Assuming the 90 days horizon J Hancock is expected to generate 1.11 times less return on investment than Us Global. But when comparing it to its historical volatility, J Hancock Ii is 1.37 times less risky than Us Global. It trades about 0.34 of its potential returns per unit of risk. Us Global Leaders is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 7,220 in Us Global Leaders on September 1, 2024 and sell it today you would earn a total of 359.00 from holding Us Global Leaders or generate 4.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
J Hancock Ii vs. Us Global Leaders
Performance |
| Timeline |
| J Hancock Ii |
| Us Global Leaders |
J Hancock and Us Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Hancock and Us Global
The main advantage of trading using opposite J Hancock and Us Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Hancock position performs unexpectedly, Us Global 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 Us Global will offset losses from the drop in Us Global's long position.| J Hancock vs. Qs Large Cap | J Hancock vs. Transamerica Large Cap | J Hancock vs. American Mutual Fund | J Hancock vs. M Large Cap |
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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