Correlation Between J Hancock and John Hancock
Can any of the company-specific risk be diversified away by investing in both J Hancock and John Hancock 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 John Hancock 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 John Hancock Income, you can compare the effects of market volatilities on J Hancock and John Hancock 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 John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Hancock and John Hancock.
Diversification Opportunities for J Hancock and John Hancock
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JRODX and John is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding J Hancock Ii and John Hancock Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Income 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 John Hancock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Hancock Income has no effect on the direction of J Hancock i.e., J Hancock and John Hancock go up and down completely randomly.
Pair Corralation between J Hancock and John Hancock
Assuming the 90 days horizon J Hancock Ii is expected to generate 2.49 times more return on investment than John Hancock. However, J Hancock is 2.49 times more volatile than John Hancock Income. It trades about 0.09 of its potential returns per unit of risk. John Hancock Income is currently generating about 0.06 per unit of risk. If you would invest 1,231 in J Hancock Ii on November 28, 2024 and sell it today you would earn a total of 405.00 from holding J Hancock Ii or generate 32.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
J Hancock Ii vs. John Hancock Income
Performance |
| Timeline |
| J Hancock Ii |
| John Hancock Income |
J Hancock and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Hancock and John Hancock
The main advantage of trading using opposite J Hancock and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Hancock position performs unexpectedly, John Hancock 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 John Hancock will offset losses from the drop in John Hancock's long position.| J Hancock vs. Invesco Gold Special | J Hancock vs. Gamco Global Gold | J Hancock vs. Precious Metals And | J Hancock vs. Wells Fargo Advantage |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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