Correlation Between Jhancock Short and Small Cap
Can any of the company-specific risk be diversified away by investing in both Jhancock Short and Small Cap 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 Small Cap 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 Small Cap Stock, you can compare the effects of market volatilities on Jhancock Short and Small Cap 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 Small Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Short and Small Cap.
Diversification Opportunities for Jhancock Short and Small Cap
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jhancock and Small is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Short Duration and Small Cap Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Cap Stock 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 Small Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Cap Stock has no effect on the direction of Jhancock Short i.e., Jhancock Short and Small Cap go up and down completely randomly.
Pair Corralation between Jhancock Short and Small Cap
Assuming the 90 days horizon Jhancock Short Duration is expected to generate 0.1 times more return on investment than Small Cap. However, Jhancock Short Duration is 9.6 times less risky than Small Cap. It trades about 0.17 of its potential returns per unit of risk. Small Cap Stock is currently generating about 0.02 per unit of risk. If you would invest 887.00 in Jhancock Short Duration on November 7, 2024 and sell it today you would earn a total of 49.00 from holding Jhancock Short Duration or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Short Duration vs. Small Cap Stock
Performance |
| Timeline |
| Jhancock Short Duration |
| Small Cap Stock |
Jhancock Short and Small Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Short and Small Cap
The main advantage of trading using opposite Jhancock Short and Small Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Short position performs unexpectedly, Small Cap 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 Small Cap will offset losses from the drop in Small Cap's long position.| Jhancock Short vs. Prudential High Yield | Jhancock Short vs. Payden High Income | Jhancock Short vs. Six Circles Credit | Jhancock Short vs. Dunham High Yield |
| Small Cap vs. Rbc International Small | Small Cap vs. Legg Mason Partners | Small Cap vs. Oklahoma College Savings | Small Cap vs. Ab Small Cap |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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