Correlation Between Saat Moderate and John Hancock
Can any of the company-specific risk be diversified away by investing in both Saat Moderate 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 Saat Moderate and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat Moderate Strategy and John Hancock Disciplined, you can compare the effects of market volatilities on Saat Moderate 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 Saat Moderate with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Moderate and John Hancock.
Diversification Opportunities for Saat Moderate and John Hancock
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Saat and John is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Saat Moderate Strategy and John Hancock Disciplined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Disciplined and Saat Moderate 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 Saat Moderate Strategy 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 Disciplined has no effect on the direction of Saat Moderate i.e., Saat Moderate and John Hancock go up and down completely randomly.
Pair Corralation between Saat Moderate and John Hancock
Assuming the 90 days horizon Saat Moderate Strategy is expected to generate 0.38 times more return on investment than John Hancock. However, Saat Moderate Strategy is 2.63 times less risky than John Hancock. It trades about 0.35 of its potential returns per unit of risk. John Hancock Disciplined is currently generating about -0.13 per unit of risk. If you would invest 1,162 in Saat Moderate Strategy on November 28, 2024 and sell it today you would earn a total of 20.00 from holding Saat Moderate Strategy or generate 1.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saat Moderate Strategy vs. John Hancock Disciplined
Performance |
| Timeline |
| Saat Moderate Strategy |
| John Hancock Disciplined |
Saat Moderate and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Moderate and John Hancock
The main advantage of trading using opposite Saat Moderate and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Moderate 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 Saat Moderate Strategy and John Hancock Disciplined 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. Franklin Federal Limited Term | John Hancock vs. Templeton Developing Markets | John Hancock vs. Investec Emerging Markets | John Hancock vs. Goldman Sachs Emerging |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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