Correlation Between Clearbridge Small and John Hancock
Can any of the company-specific risk be diversified away by investing in both Clearbridge 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 Clearbridge 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 Clearbridge Small Cap and John Hancock Government, you can compare the effects of market volatilities on Clearbridge 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 Clearbridge Small with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clearbridge Small and John Hancock.
Diversification Opportunities for Clearbridge Small and John Hancock
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Clearbridge and John is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Clearbridge Small Cap 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 Clearbridge 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 Clearbridge 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 Government has no effect on the direction of Clearbridge Small i.e., Clearbridge Small and John Hancock go up and down completely randomly.
Pair Corralation between Clearbridge Small and John Hancock
Assuming the 90 days horizon Clearbridge Small Cap is expected to generate 3.05 times more return on investment than John Hancock. However, Clearbridge Small is 3.05 times more volatile than John Hancock Government. It trades about 0.08 of its potential returns per unit of risk. John Hancock Government is currently generating about 0.04 per unit of risk. If you would invest 3,293 in Clearbridge Small Cap on September 2, 2024 and sell it today you would earn a total of 768.00 from holding Clearbridge Small Cap or generate 23.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clearbridge Small Cap vs. John Hancock Government
Performance |
| Timeline |
| Clearbridge Small Cap |
| John Hancock Government |
Clearbridge Small and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clearbridge Small and John Hancock
The main advantage of trading using opposite Clearbridge Small and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clearbridge 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.| Clearbridge Small vs. Clearbridge Aggressive Growth | Clearbridge Small vs. Clearbridge Small Cap | Clearbridge Small vs. Qs International Equity | Clearbridge Small vs. Clearbridge Appreciation Fund |
| John Hancock vs. Volumetric Fund Volumetric | John Hancock vs. Rbc Microcap Value | John Hancock vs. T Rowe Price | John Hancock vs. Falcon Focus Scv |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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