Correlation Between Sterling Capital and Jhancock Global
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Jhancock Global 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 Sterling Capital and Jhancock Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Mid and Jhancock Global Equity, you can compare the effects of market volatilities on Sterling Capital and Jhancock Global 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 Sterling Capital with a short position of Jhancock Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Jhancock Global.
Diversification Opportunities for Sterling Capital and Jhancock Global
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sterling and Jhancock is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Mid and Jhancock Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Global Equity and Sterling Capital 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 Sterling Capital Mid are associated (or correlated) with Jhancock Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Global Equity has no effect on the direction of Sterling Capital i.e., Sterling Capital and Jhancock Global go up and down completely randomly.
Pair Corralation between Sterling Capital and Jhancock Global
Assuming the 90 days horizon Sterling Capital is expected to generate 1.79 times less return on investment than Jhancock Global. In addition to that, Sterling Capital is 1.43 times more volatile than Jhancock Global Equity. It trades about 0.03 of its total potential returns per unit of risk. Jhancock Global Equity is currently generating about 0.07 per unit of volatility. If you would invest 1,171 in Jhancock Global Equity on September 12, 2024 and sell it today you would earn a total of 187.00 from holding Jhancock Global Equity or generate 15.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Mid vs. Jhancock Global Equity
Performance |
| Timeline |
| Sterling Capital Mid |
| Jhancock Global Equity |
Sterling Capital and Jhancock Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Jhancock Global
The main advantage of trading using opposite Sterling Capital and Jhancock Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Jhancock Global 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 Jhancock Global will offset losses from the drop in Jhancock Global's long position.| Sterling Capital vs. Jhancock Global Equity | Sterling Capital vs. Siit Global Managed | Sterling Capital vs. Franklin Mutual Global | Sterling Capital vs. Ab Global Bond |
| Jhancock Global vs. John Hancock Financial | Jhancock Global vs. Blackrock Financial Institutions | Jhancock Global vs. Angel Oak Financial | Jhancock Global vs. Icon Financial Fund |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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