Correlation Between John Hancock and Touchstone Large
Can any of the company-specific risk be diversified away by investing in both John Hancock and Touchstone Large 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 Touchstone Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Disciplined and Touchstone Large Cap, you can compare the effects of market volatilities on John Hancock and Touchstone Large 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 Touchstone Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Touchstone Large.
Diversification Opportunities for John Hancock and Touchstone Large
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between John and Touchstone is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Disciplined and Touchstone Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Large Cap 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 Disciplined are associated (or correlated) with Touchstone Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Large Cap has no effect on the direction of John Hancock i.e., John Hancock and Touchstone Large go up and down completely randomly.
Pair Corralation between John Hancock and Touchstone Large
Assuming the 90 days horizon John Hancock Disciplined is expected to generate 1.32 times more return on investment than Touchstone Large. However, John Hancock is 1.32 times more volatile than Touchstone Large Cap. It trades about 0.11 of its potential returns per unit of risk. Touchstone Large Cap is currently generating about 0.11 per unit of risk. If you would invest 2,065 in John Hancock Disciplined on September 1, 2024 and sell it today you would earn a total of 809.00 from holding John Hancock Disciplined or generate 39.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Disciplined vs. Touchstone Large Cap
Performance |
| Timeline |
| John Hancock Disciplined |
| Touchstone Large Cap |
John Hancock and Touchstone Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Touchstone Large
The main advantage of trading using opposite John Hancock and Touchstone Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Touchstone Large 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 Touchstone Large will offset losses from the drop in Touchstone Large's long position.| John Hancock vs. Live Oak Health | John Hancock vs. Alphacentric Lifesci Healthcare | John Hancock vs. The Gabelli Healthcare | John Hancock vs. Health Biotchnology Portfolio |
| Touchstone Large vs. Touchstone Small Cap | Touchstone Large vs. Mid Cap Growth | Touchstone Large vs. Mid Cap Growth | Touchstone Large vs. Mid Cap Growth |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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