Correlation Between John Hancock and Monteagle Select

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Can any of the company-specific risk be diversified away by investing in both John Hancock and Monteagle Select 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 Monteagle Select 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 Monteagle Select Value, you can compare the effects of market volatilities on John Hancock and Monteagle Select 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 Monteagle Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Monteagle Select.

Diversification Opportunities for John Hancock and Monteagle Select

0.87
  Correlation Coefficient

Very poor diversification

The 3 months correlation between John and Monteagle is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Disciplined and Monteagle Select Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monteagle Select Value 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 Monteagle Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monteagle Select Value has no effect on the direction of John Hancock i.e., John Hancock and Monteagle Select go up and down completely randomly.

Pair Corralation between John Hancock and Monteagle Select

Assuming the 90 days horizon John Hancock Disciplined is expected to generate 1.18 times more return on investment than Monteagle Select. However, John Hancock is 1.18 times more volatile than Monteagle Select Value. It trades about 0.07 of its potential returns per unit of risk. Monteagle Select Value is currently generating about 0.04 per unit of risk. If you would invest  2,406  in John Hancock Disciplined on September 3, 2024 and sell it today you would earn a total of  841.00  from holding John Hancock Disciplined or generate 34.95% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

John Hancock Disciplined  vs.  Monteagle Select Value

 Performance 
       Timeline  
John Hancock Disciplined 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Disciplined are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, John Hancock may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Monteagle Select Value 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Monteagle Select Value are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Monteagle Select is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

John Hancock and Monteagle Select Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with John Hancock and Monteagle Select

The main advantage of trading using opposite John Hancock and Monteagle Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Monteagle Select 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 Monteagle Select will offset losses from the drop in Monteagle Select's long position.
The idea behind John Hancock Disciplined and Monteagle Select Value pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

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