Correlation Between Jhancock Short and Saat Defensive
Can any of the company-specific risk be diversified away by investing in both Jhancock Short and Saat Defensive 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 Jhancock Short and Saat Defensive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jhancock Short Duration and Saat Defensive Strategy, you can compare the effects of market volatilities on Jhancock Short and Saat Defensive 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 Jhancock Short with a short position of Saat Defensive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Short and Saat Defensive.
Diversification Opportunities for Jhancock Short and Saat Defensive
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jhancock and Saat is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Short Duration and Saat Defensive Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Defensive Strategy and Jhancock Short 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 Jhancock Short Duration are associated (or correlated) with Saat Defensive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Defensive Strategy has no effect on the direction of Jhancock Short i.e., Jhancock Short and Saat Defensive go up and down completely randomly.
Pair Corralation between Jhancock Short and Saat Defensive
Assuming the 90 days horizon Jhancock Short Duration is expected to generate 1.05 times more return on investment than Saat Defensive. However, Jhancock Short is 1.05 times more volatile than Saat Defensive Strategy. It trades about 0.15 of its potential returns per unit of risk. Saat Defensive Strategy is currently generating about 0.15 per unit of risk. If you would invest 859.00 in Jhancock Short Duration on August 29, 2024 and sell it today you would earn a total of 76.00 from holding Jhancock Short Duration or generate 8.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Short Duration vs. Saat Defensive Strategy
Performance |
| Timeline |
| Jhancock Short Duration |
| Saat Defensive Strategy |
Jhancock Short and Saat Defensive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Short and Saat Defensive
The main advantage of trading using opposite Jhancock Short and Saat Defensive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Short position performs unexpectedly, Saat Defensive 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 Saat Defensive will offset losses from the drop in Saat Defensive's long position.| Jhancock Short vs. Regional Bank Fund | Jhancock Short vs. Regional Bank Fund | Jhancock Short vs. Multimanager Lifestyle Moderate | Jhancock Short vs. Multimanager Lifestyle Balanced |
| Saat Defensive vs. T Rowe Price | Saat Defensive vs. California High Yield Municipal | Saat Defensive vs. Oklahoma Municipal Fund | Saat Defensive vs. Transamerica Intermediate Muni |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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