Correlation Between SPDR Portfolio and John Hancock
Can any of the company-specific risk be diversified away by investing in both SPDR Portfolio 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 SPDR Portfolio and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Portfolio Emerging and John Hancock Multifactor, you can compare the effects of market volatilities on SPDR Portfolio 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 SPDR Portfolio with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and John Hancock.
Diversification Opportunities for SPDR Portfolio and John Hancock
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPDR and John is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio Emerging and John Hancock Multifactor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Multifactor and SPDR Portfolio 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 SPDR Portfolio Emerging 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 Multifactor has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and John Hancock go up and down completely randomly.
Pair Corralation between SPDR Portfolio and John Hancock
Given the investment horizon of 90 days SPDR Portfolio Emerging is expected to generate 0.99 times more return on investment than John Hancock. However, SPDR Portfolio Emerging is 1.01 times less risky than John Hancock. It trades about 0.05 of its potential returns per unit of risk. John Hancock Multifactor is currently generating about 0.01 per unit of risk. If you would invest 3,722 in SPDR Portfolio Emerging on September 1, 2024 and sell it today you would earn a total of 218.00 from holding SPDR Portfolio Emerging or generate 5.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
SPDR Portfolio Emerging vs. John Hancock Multifactor
Performance |
| Timeline |
| SPDR Portfolio Emerging |
| John Hancock Multifactor |
SPDR Portfolio and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Portfolio and John Hancock
The main advantage of trading using opposite SPDR Portfolio and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Portfolio 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.| SPDR Portfolio vs. Xtrackers MSCI Emerging | SPDR Portfolio vs. FlexShares Morningstar Emerging | SPDR Portfolio vs. First Trust Emerging |
| John Hancock vs. Xtrackers MSCI Emerging | John Hancock vs. FlexShares Morningstar Emerging | John Hancock vs. First Trust 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 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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