Correlation Between Columbia Seligman and John Hancock
Can any of the company-specific risk be diversified away by investing in both Columbia Seligman 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 Columbia Seligman and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Seligman Premium and John Hancock Hedged, you can compare the effects of market volatilities on Columbia Seligman 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 Columbia Seligman with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Seligman and John Hancock.
Diversification Opportunities for Columbia Seligman and John Hancock
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Columbia and John is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Seligman Premium and John Hancock Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Hedged and Columbia Seligman 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 Columbia Seligman Premium 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 Hedged has no effect on the direction of Columbia Seligman i.e., Columbia Seligman and John Hancock go up and down completely randomly.
Pair Corralation between Columbia Seligman and John Hancock
Considering the 90-day investment horizon Columbia Seligman Premium is expected to generate 1.71 times more return on investment than John Hancock. However, Columbia Seligman is 1.71 times more volatile than John Hancock Hedged. It trades about 0.09 of its potential returns per unit of risk. John Hancock Hedged is currently generating about 0.11 per unit of risk. If you would invest 3,207 in Columbia Seligman Premium on August 28, 2024 and sell it today you would earn a total of 177.00 from holding Columbia Seligman Premium or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Seligman Premium vs. John Hancock Hedged
Performance |
| Timeline |
| Columbia Seligman Premium |
| John Hancock Hedged |
Columbia Seligman and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Seligman and John Hancock
The main advantage of trading using opposite Columbia Seligman and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Seligman 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.| Columbia Seligman vs. Eaton Vance Enhanced | Columbia Seligman vs. BlackRock Utility Infrastructure | Columbia Seligman vs. BlackRock Health Sciences | Columbia Seligman vs. BlackRock Science Tech |
| John Hancock vs. Ellsworth Convertible Growth | John Hancock vs. Delaware Investments Florida | John Hancock vs. RENN Fund | John Hancock vs. Nuveen New Jersey |
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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