Correlation Between John Hancock and Us Global
Can any of the company-specific risk be diversified away by investing in both John 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 John 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 John Hancock Income and Us Global Leaders, you can compare the effects of market volatilities on John 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 John Hancock with a short position of Us Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Us Global.
Diversification Opportunities for John Hancock and Us Global
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between John and USLIX is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Income 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 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 Income 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 John Hancock i.e., John Hancock and Us Global go up and down completely randomly.
Pair Corralation between John Hancock and Us Global
Assuming the 90 days horizon John Hancock is expected to generate 4.2 times less return on investment than Us Global. But when comparing it to its historical volatility, John Hancock Income is 2.74 times less risky than Us Global. It trades about 0.07 of its potential returns per unit of risk. Us Global Leaders is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 6,234 in Us Global Leaders on September 2, 2024 and sell it today you would earn a total of 2,343 from holding Us Global Leaders or generate 37.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Income vs. Us Global Leaders
Performance |
| Timeline |
| John Hancock Income |
| Us Global Leaders |
John Hancock and Us Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Us Global
The main advantage of trading using opposite John Hancock and Us Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John 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.| John Hancock vs. Regional Bank Fund | John Hancock vs. Regional Bank Fund | John Hancock vs. Multimanager Lifestyle Moderate | John Hancock vs. Multimanager Lifestyle Balanced |
| Us Global vs. Applied Finance Explorer | Us Global vs. Hennessy Nerstone Mid | Us Global vs. Ab Discovery Value | Us Global vs. Lord Abbett Small |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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