Correlation Between Kinetics Small and John Hancock
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and John Hancock 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 Kinetics Small and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Small Cap and John Hancock Focused, you can compare the effects of market volatilities on Kinetics Small and John Hancock 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 Kinetics Small with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and John Hancock.
Diversification Opportunities for Kinetics Small and John Hancock
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kinetics and John is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and John Hancock Focused in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Focused and Kinetics Small 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 Kinetics Small Cap are associated (or correlated) with John Hancock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Hancock Focused has no effect on the direction of Kinetics Small i.e., Kinetics Small and John Hancock go up and down completely randomly.
Pair Corralation between Kinetics Small and John Hancock
Assuming the 90 days horizon Kinetics Small Cap is expected to generate 6.44 times more return on investment than John Hancock. However, Kinetics Small is 6.44 times more volatile than John Hancock Focused. It trades about 0.06 of its potential returns per unit of risk. John Hancock Focused is currently generating about 0.08 per unit of risk. If you would invest 10,647 in Kinetics Small Cap on January 9, 2025 and sell it today you would earn a total of 6,261 from holding Kinetics Small Cap or generate 58.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Kinetics Small Cap vs. John Hancock Focused
Performance |
| Timeline |
| Kinetics Small Cap |
| John Hancock Focused |
Kinetics Small and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and John Hancock
The main advantage of trading using opposite Kinetics Small and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, John Hancock 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 John Hancock will offset losses from the drop in John Hancock's long position.| Kinetics Small vs. Materials Portfolio Fidelity | Kinetics Small vs. Rbb Fund | Kinetics Small vs. Ab Value Fund | Kinetics Small vs. Fbjygx |
| John Hancock vs. Regional Bank Fund | John Hancock vs. Regional Bank Fund | John Hancock vs. Multimanager Lifestyle Moderate | John Hancock 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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