Correlation Between John Hancock and Gateway Fund
Can any of the company-specific risk be diversified away by investing in both John Hancock and Gateway Fund 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 Gateway Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Ii and Gateway Fund Class, you can compare the effects of market volatilities on John Hancock and Gateway Fund 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 Gateway Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Gateway Fund.
Diversification Opportunities for John Hancock and Gateway Fund
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between John and Gateway is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Ii and Gateway Fund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gateway Fund Class 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 Ii are associated (or correlated) with Gateway Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gateway Fund Class has no effect on the direction of John Hancock i.e., John Hancock and Gateway Fund go up and down completely randomly.
Pair Corralation between John Hancock and Gateway Fund
Assuming the 90 days horizon John Hancock is expected to generate 1.64 times less return on investment than Gateway Fund. In addition to that, John Hancock is 2.92 times more volatile than Gateway Fund Class. It trades about 0.03 of its total potential returns per unit of risk. Gateway Fund Class is currently generating about 0.15 per unit of volatility. If you would invest 3,492 in Gateway Fund Class on September 14, 2024 and sell it today you would earn a total of 1,236 from holding Gateway Fund Class or generate 35.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
John Hancock Ii vs. Gateway Fund Class
Performance |
| Timeline |
| John Hancock Ii |
| Gateway Fund Class |
John Hancock and Gateway Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Gateway Fund
The main advantage of trading using opposite John Hancock and Gateway Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Gateway Fund 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 Gateway Fund will offset losses from the drop in Gateway Fund's long position.| John Hancock vs. Regional Bank Fund | John Hancock vs. Regional Bank Fund | John Hancock vs. Multimanager Lifestyle Moderate | John Hancock vs. Multimanager Lifestyle Balanced |
| Gateway Fund vs. William Blair Small | Gateway Fund vs. Victory Rs Partners | Gateway Fund vs. John Hancock Ii | Gateway Fund vs. Amg River Road |
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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