Correlation Between John Hancock and Janus Enterprise
Can any of the company-specific risk be diversified away by investing in both John Hancock and Janus Enterprise 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 Janus Enterprise 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 Janus Enterprise Fund, you can compare the effects of market volatilities on John Hancock and Janus Enterprise 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 Janus Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Janus Enterprise.
Diversification Opportunities for John Hancock and Janus Enterprise
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between John and Janus is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Disciplined and Janus Enterprise Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Enterprise 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 Janus Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Enterprise has no effect on the direction of John Hancock i.e., John Hancock and Janus Enterprise go up and down completely randomly.
Pair Corralation between John Hancock and Janus Enterprise
Assuming the 90 days horizon John Hancock Disciplined is expected to generate 1.15 times more return on investment than Janus Enterprise. However, John Hancock is 1.15 times more volatile than Janus Enterprise Fund. It trades about 0.14 of its potential returns per unit of risk. Janus Enterprise Fund is currently generating about 0.12 per unit of risk. If you would invest 3,060 in John Hancock Disciplined on August 25, 2024 and sell it today you would earn a total of 165.00 from holding John Hancock Disciplined or generate 5.39% 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. Janus Enterprise Fund
Performance |
| Timeline |
| John Hancock Disciplined |
| Janus Enterprise |
John Hancock and Janus Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Hancock and Janus Enterprise
The main advantage of trading using opposite John Hancock and Janus Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Janus Enterprise 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 Janus Enterprise will offset losses from the drop in Janus Enterprise'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 |
| Janus Enterprise vs. John Hancock Disciplined | Janus Enterprise vs. Wells Fargo Special | Janus Enterprise vs. Janus Triton Fund | Janus Enterprise vs. Virtus Kar 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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