Correlation Between Lord Abbett and J Hancock
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and J 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 Lord Abbett and J Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Diversified and J Hancock Ii, you can compare the effects of market volatilities on Lord Abbett and J 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 Lord Abbett with a short position of J Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and J Hancock.
Diversification Opportunities for Lord Abbett and J Hancock
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lord and JGHTX is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Diversified and J Hancock Ii in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J Hancock Ii and Lord Abbett 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 Lord Abbett Diversified are associated (or correlated) with J Hancock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J Hancock Ii has no effect on the direction of Lord Abbett i.e., Lord Abbett and J Hancock go up and down completely randomly.
Pair Corralation between Lord Abbett and J Hancock
Assuming the 90 days horizon Lord Abbett is expected to generate 2.16 times less return on investment than J Hancock. But when comparing it to its historical volatility, Lord Abbett Diversified is 1.65 times less risky than J Hancock. It trades about 0.13 of its potential returns per unit of risk. J Hancock Ii is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,440 in J Hancock Ii on September 13, 2024 and sell it today you would earn a total of 24.00 from holding J Hancock Ii or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Lord Abbett Diversified vs. J Hancock Ii
Performance |
| Timeline |
| Lord Abbett Diversified |
| J Hancock Ii |
Lord Abbett and J Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and J Hancock
The main advantage of trading using opposite Lord Abbett and J Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, J 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 J Hancock will offset losses from the drop in J Hancock's long position.| Lord Abbett vs. T Rowe Price | Lord Abbett vs. Versatile Bond Portfolio | Lord Abbett vs. Pace High Yield | Lord Abbett vs. Dws Government Money |
| J Hancock vs. Regional Bank Fund | J Hancock vs. Regional Bank Fund | J Hancock vs. Multimanager Lifestyle Moderate | J 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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