Correlation Between John Hancock and The Jensen
Can any of the company-specific risk be diversified away by investing in both John Hancock and The Jensen 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 The Jensen 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 The Jensen Portfolio, you can compare the effects of market volatilities on John Hancock and The Jensen 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 The Jensen. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and The Jensen.
Diversification Opportunities for John Hancock and The Jensen
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between John and The is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Disciplined and The Jensen Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jensen Portfolio 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 The Jensen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jensen Portfolio has no effect on the direction of John Hancock i.e., John Hancock and The Jensen go up and down completely randomly.
Pair Corralation between John Hancock and The Jensen
Assuming the 90 days horizon John Hancock Disciplined is expected to generate 0.78 times more return on investment than The Jensen. However, John Hancock Disciplined is 1.28 times less risky than The Jensen. It trades about 0.1 of its potential returns per unit of risk. The Jensen Portfolio is currently generating about 0.0 per unit of risk. If you would invest 2,911 in John Hancock Disciplined on August 29, 2024 and sell it today you would earn a total of 336.00 from holding John Hancock Disciplined or generate 11.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Hancock Disciplined vs. The Jensen Portfolio
Performance |
| Timeline |
| John Hancock Disciplined |
| Jensen Portfolio |
John Hancock and The Jensen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and The Jensen
The main advantage of trading using opposite John Hancock and The Jensen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, The Jensen 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 The Jensen will offset losses from the drop in The Jensen's long position.| John Hancock vs. New World Fund | John Hancock vs. Bond Fund Of | John Hancock vs. Washington Mutual Investors | John Hancock vs. Europacific Growth Fund |
| The Jensen vs. T Rowe Price | The Jensen vs. Balanced Fund Investor | The Jensen vs. Aam Select Income | The Jensen vs. Arrow Managed Futures |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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