Correlation Between Legg Mason and J Hancock
Can any of the company-specific risk be diversified away by investing in both Legg Mason 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 Legg Mason and J Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legg Mason Partners and J Hancock Ii, you can compare the effects of market volatilities on Legg Mason 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 Legg Mason with a short position of J Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legg Mason and J Hancock.
Diversification Opportunities for Legg Mason and J Hancock
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Legg and JROUX is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Legg Mason Partners 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 Legg Mason 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 Legg Mason Partners 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 Legg Mason i.e., Legg Mason and J Hancock go up and down completely randomly.
Pair Corralation between Legg Mason and J Hancock
If you would invest 1,398 in J Hancock Ii on September 3, 2024 and sell it today you would earn a total of 58.00 from holding J Hancock Ii or generate 4.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Legg Mason Partners vs. J Hancock Ii
Performance |
| Timeline |
| Legg Mason Partners |
| J Hancock Ii |
Legg Mason and J Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legg Mason and J Hancock
The main advantage of trading using opposite Legg Mason and J Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legg Mason 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.| Legg Mason vs. Vanguard Total Stock | Legg Mason vs. Vanguard 500 Index | Legg Mason vs. Vanguard Total Stock | Legg Mason vs. Vanguard Total Stock |
| J Hancock vs. Angel Oak Financial | J Hancock vs. California Bond Fund | J Hancock vs. Bbh Intermediate Municipal | J Hancock vs. Versatile Bond Portfolio |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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