Correlation Between Retirement Living and John Hancock
Can any of the company-specific risk be diversified away by investing in both Retirement Living 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 Retirement Living and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retirement Living Through and John Hancock Global, you can compare the effects of market volatilities on Retirement Living 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 Retirement Living with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retirement Living and John Hancock.
Diversification Opportunities for Retirement Living and John Hancock
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Retirement and John is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Retirement Living Through and John Hancock Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Global and Retirement Living 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 Retirement Living Through 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 Global has no effect on the direction of Retirement Living i.e., Retirement Living and John Hancock go up and down completely randomly.
Pair Corralation between Retirement Living and John Hancock
Assuming the 90 days horizon Retirement Living Through is expected to generate 0.65 times more return on investment than John Hancock. However, Retirement Living Through is 1.55 times less risky than John Hancock. It trades about 0.09 of its potential returns per unit of risk. John Hancock Global is currently generating about 0.05 per unit of risk. If you would invest 1,058 in Retirement Living Through on August 31, 2024 and sell it today you would earn a total of 228.00 from holding Retirement Living Through or generate 21.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Retirement Living Through vs. John Hancock Global
Performance |
| Timeline |
| Retirement Living Through |
| John Hancock Global |
Retirement Living and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retirement Living and John Hancock
The main advantage of trading using opposite Retirement Living and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retirement Living 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.| Retirement Living vs. Jhancock Diversified Macro | Retirement Living vs. Harbor Diversified International | Retirement Living vs. Aqr Diversified Arbitrage | Retirement Living vs. Western Asset Diversified |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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