Correlation Between Lifex Inflation-protec and John Hancock
Can any of the company-specific risk be diversified away by investing in both Lifex Inflation-protec 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 Lifex Inflation-protec and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifex Inflation Protected Income and John Hancock Government, you can compare the effects of market volatilities on Lifex Inflation-protec 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 Lifex Inflation-protec with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifex Inflation-protec and John Hancock.
Diversification Opportunities for Lifex Inflation-protec and John Hancock
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lifex and John is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Lifex Inflation Protected Inco and John Hancock Government in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Government and Lifex Inflation-protec 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 Lifex Inflation Protected Income 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 Government has no effect on the direction of Lifex Inflation-protec i.e., Lifex Inflation-protec and John Hancock go up and down completely randomly.
Pair Corralation between Lifex Inflation-protec and John Hancock
Assuming the 90 days horizon Lifex Inflation Protected Income is expected to generate 0.94 times more return on investment than John Hancock. However, Lifex Inflation Protected Income is 1.06 times less risky than John Hancock. It trades about 0.06 of its potential returns per unit of risk. John Hancock Government is currently generating about 0.02 per unit of risk. If you would invest 1,890 in Lifex Inflation Protected Income on August 30, 2024 and sell it today you would earn a total of 103.00 from holding Lifex Inflation Protected Income or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 44.24% |
| Values | Daily Returns |
Lifex Inflation Protected Inco vs. John Hancock Government
Performance |
| Timeline |
| Lifex Inflation-protec |
| John Hancock Government |
Lifex Inflation-protec and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifex Inflation-protec and John Hancock
The main advantage of trading using opposite Lifex Inflation-protec and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifex Inflation-protec 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.| Lifex Inflation-protec vs. John Hancock Government | Lifex Inflation-protec vs. Us Government Plus | Lifex Inflation-protec vs. Virtus Seix Government | Lifex Inflation-protec vs. Us Government Securities |
| John Hancock vs. Us Global Investors | John Hancock vs. T Rowe Price | John Hancock vs. Ab Global Bond | John Hancock vs. Barings Global Floating |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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