Correlation Between John Hancock and Alternative Asset
Can any of the company-specific risk be diversified away by investing in both John Hancock and Alternative Asset 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 Alternative Asset 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 Alternative Asset Allocation, you can compare the effects of market volatilities on John Hancock and Alternative Asset 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 Alternative Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Alternative Asset.
Diversification Opportunities for John Hancock and Alternative Asset
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between John and Alternative is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Disciplined and Alternative Asset Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alternative Asset 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 Alternative Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alternative Asset has no effect on the direction of John Hancock i.e., John Hancock and Alternative Asset go up and down completely randomly.
Pair Corralation between John Hancock and Alternative Asset
Assuming the 90 days horizon John Hancock Disciplined is expected to under-perform the Alternative Asset. In addition to that, John Hancock is 3.99 times more volatile than Alternative Asset Allocation. It trades about -0.07 of its total potential returns per unit of risk. Alternative Asset Allocation is currently generating about 0.33 per unit of volatility. If you would invest 1,616 in Alternative Asset Allocation on September 13, 2024 and sell it today you would earn a total of 18.00 from holding Alternative Asset Allocation or generate 1.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
John Hancock Disciplined vs. Alternative Asset Allocation
Performance |
| Timeline |
| John Hancock Disciplined |
| Alternative Asset |
John Hancock and Alternative Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Alternative Asset
The main advantage of trading using opposite John Hancock and Alternative Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Alternative Asset 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 Alternative Asset will offset losses from the drop in Alternative Asset's long position.| John Hancock vs. John Hancock Disciplined | John Hancock vs. John Hancock Bond | John Hancock vs. Us Global Leaders | John Hancock vs. Mfs International Value |
| Alternative Asset vs. Regional Bank Fund | Alternative Asset vs. Regional Bank Fund | Alternative Asset vs. Multimanager Lifestyle Moderate | Alternative Asset vs. Multimanager Lifestyle Balanced |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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