Correlation Between Great West and John Hancock
Can any of the company-specific risk be diversified away by investing in both Great West 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 Great West and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great West Goldman Sachs and John Hancock Investment, you can compare the effects of market volatilities on Great West 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 Great West with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great West and John Hancock.
Diversification Opportunities for Great West and John Hancock
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Great and John is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Great West Goldman Sachs and John Hancock Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Investment and Great West 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 Great West Goldman Sachs 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 Investment has no effect on the direction of Great West i.e., Great West and John Hancock go up and down completely randomly.
Pair Corralation between Great West and John Hancock
Assuming the 90 days horizon Great West is expected to generate 1.63 times less return on investment than John Hancock. In addition to that, Great West is 1.15 times more volatile than John Hancock Investment. It trades about 0.06 of its total potential returns per unit of risk. John Hancock Investment is currently generating about 0.11 per unit of volatility. If you would invest 8,206 in John Hancock Investment on September 12, 2024 and sell it today you would earn a total of 101.00 from holding John Hancock Investment or generate 1.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Great West Goldman Sachs vs. John Hancock Investment
Performance |
| Timeline |
| Great West Goldman |
| John Hancock Investment |
Great West and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great West and John Hancock
The main advantage of trading using opposite Great West and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great West 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.| Great West vs. Fm Investments Large | Great West vs. Pace Large Growth | Great West vs. T Rowe Price | Great West vs. Aqr Large Cap |
| John Hancock vs. Vy Goldman Sachs | John Hancock vs. Franklin Gold Precious | John Hancock vs. Short Precious Metals | John Hancock vs. Precious Metals And |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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