Correlation Between Jackson Financial and Vericity
Can any of the company-specific risk be diversified away by investing in both Jackson Financial and Vericity 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 Jackson Financial and Vericity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jackson Financial and Vericity, you can compare the effects of market volatilities on Jackson Financial and Vericity 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 Jackson Financial with a short position of Vericity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jackson Financial and Vericity.
Diversification Opportunities for Jackson Financial and Vericity
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Jackson and Vericity is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Jackson Financial and Vericity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vericity and Jackson Financial 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 Jackson Financial are associated (or correlated) with Vericity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vericity has no effect on the direction of Jackson Financial i.e., Jackson Financial and Vericity go up and down completely randomly.
Pair Corralation between Jackson Financial and Vericity
Considering the 90-day investment horizon Jackson Financial is expected to generate 0.36 times more return on investment than Vericity. However, Jackson Financial is 2.75 times less risky than Vericity. It trades about 0.15 of its potential returns per unit of risk. Vericity is currently generating about 0.05 per unit of risk. If you would invest 2,830 in Jackson Financial on August 31, 2024 and sell it today you would earn a total of 7,189 from holding Jackson Financial or generate 254.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 72.19% |
| Values | Daily Returns |
Jackson Financial vs. Vericity
Performance |
| Timeline |
| Jackson Financial |
| Vericity |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Jackson Financial and Vericity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jackson Financial and Vericity
The main advantage of trading using opposite Jackson Financial and Vericity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jackson Financial position performs unexpectedly, Vericity 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 Vericity will offset losses from the drop in Vericity's long position.| Jackson Financial vs. Prudential Financial | Jackson Financial vs. MetLife | Jackson Financial vs. Unum Group | Jackson Financial vs. Manulife Financial Corp |
| Vericity vs. CNO Financial Group | Vericity vs. Brighthouse Financial | Vericity vs. FG Annuities Life | Vericity vs. Prudential Public Limited |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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