Correlation Between Catalystmillburn and Jhancock Real
Can any of the company-specific risk be diversified away by investing in both Catalystmillburn and Jhancock Real 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 Catalystmillburn and Jhancock Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalystmillburn Hedge Strategy and Jhancock Real Estate, you can compare the effects of market volatilities on Catalystmillburn and Jhancock Real 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 Catalystmillburn with a short position of Jhancock Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalystmillburn and Jhancock Real.
Diversification Opportunities for Catalystmillburn and Jhancock Real
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Catalystmillburn and Jhancock is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Catalystmillburn Hedge Strateg and Jhancock Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Real Estate and Catalystmillburn 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 Catalystmillburn Hedge Strategy are associated (or correlated) with Jhancock Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Real Estate has no effect on the direction of Catalystmillburn i.e., Catalystmillburn and Jhancock Real go up and down completely randomly.
Pair Corralation between Catalystmillburn and Jhancock Real
Assuming the 90 days horizon Catalystmillburn is expected to generate 1.06 times less return on investment than Jhancock Real. But when comparing it to its historical volatility, Catalystmillburn Hedge Strategy is 1.43 times less risky than Jhancock Real. It trades about 0.04 of its potential returns per unit of risk. Jhancock Real Estate is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,034 in Jhancock Real Estate on January 24, 2025 and sell it today you would earn a total of 139.00 from holding Jhancock Real Estate or generate 13.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalystmillburn Hedge Strateg vs. Jhancock Real Estate
Performance |
| Timeline |
| Catalystmillburn Hedge |
| Jhancock Real Estate |
Catalystmillburn and Jhancock Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalystmillburn and Jhancock Real
The main advantage of trading using opposite Catalystmillburn and Jhancock Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalystmillburn position performs unexpectedly, Jhancock Real 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 Jhancock Real will offset losses from the drop in Jhancock Real's long position.| Catalystmillburn vs. Catalystsmh High Income | Catalystmillburn vs. Catalystsmh High Income | Catalystmillburn vs. Catalystsmh High Income | Catalystmillburn vs. Catalyst Mlp Infrastructure |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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