Correlation Between J Hancock and Global Equity
Can any of the company-specific risk be diversified away by investing in both J Hancock and Global Equity 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 Global Equity 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 Global Equity Fund, you can compare the effects of market volatilities on J Hancock and Global Equity 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 Global Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Hancock and Global Equity.
Diversification Opportunities for J Hancock and Global Equity
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JROUX and Global is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding J Hancock Ii and Global Equity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Equity 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 Global Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Equity has no effect on the direction of J Hancock i.e., J Hancock and Global Equity go up and down completely randomly.
Pair Corralation between J Hancock and Global Equity
Assuming the 90 days horizon J Hancock Ii is expected to generate 1.18 times more return on investment than Global Equity. However, J Hancock is 1.18 times more volatile than Global Equity Fund. It trades about 0.16 of its potential returns per unit of risk. Global Equity Fund is currently generating about 0.15 per unit of risk. If you would invest 1,055 in J Hancock Ii on August 25, 2024 and sell it today you would earn a total of 381.00 from holding J Hancock Ii or generate 36.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.63% |
| Values | Daily Returns |
J Hancock Ii vs. Global Equity Fund
Performance |
| Timeline |
| J Hancock Ii |
| Global Equity |
J Hancock and Global Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Hancock and Global Equity
The main advantage of trading using opposite J Hancock and Global Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Hancock position performs unexpectedly, Global Equity 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 Global Equity will offset losses from the drop in Global Equity's long position.| J Hancock vs. Fidelity Freedom Index | J Hancock vs. Fidelity Freedom 2060 | J Hancock vs. Fidelity Freedom 2060 |
| Global Equity vs. T Rowe Price | Global Equity vs. Nuveen All American Municipal | Global Equity vs. Transamerica Intermediate Muni | Global Equity vs. Nuveen Minnesota Municipal |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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