Correlation Between SoFi Next and John Hancock
Can any of the company-specific risk be diversified away by investing in both SoFi Next 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 SoFi Next and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoFi Next 500 and John Hancock Preferred, you can compare the effects of market volatilities on SoFi Next 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 SoFi Next with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoFi Next and John Hancock.
Diversification Opportunities for SoFi Next and John Hancock
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SoFi and John is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding SoFi Next 500 and John Hancock Preferred in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Preferred and SoFi Next 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 SoFi Next 500 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 Preferred has no effect on the direction of SoFi Next i.e., SoFi Next and John Hancock go up and down completely randomly.
Pair Corralation between SoFi Next and John Hancock
Given the investment horizon of 90 days SoFi Next 500 is expected to generate 1.15 times more return on investment than John Hancock. However, SoFi Next is 1.15 times more volatile than John Hancock Preferred. It trades about 0.07 of its potential returns per unit of risk. John Hancock Preferred is currently generating about 0.06 per unit of risk. If you would invest 1,098 in SoFi Next 500 on August 30, 2024 and sell it today you would earn a total of 470.00 from holding SoFi Next 500 or generate 42.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
SoFi Next 500 vs. John Hancock Preferred
Performance |
| Timeline |
| SoFi Next 500 |
| John Hancock Preferred |
SoFi Next and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoFi Next and John Hancock
The main advantage of trading using opposite SoFi Next and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoFi Next 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.The idea behind SoFi Next 500 and John Hancock Preferred pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| John Hancock vs. Eaton Vance National | John Hancock vs. Invesco High Income | John Hancock vs. Blackrock Muniholdings Ny | John Hancock vs. Nuveen California Select |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |