Correlation Between Government Securities and John Hancock
Can any of the company-specific risk be diversified away by investing in both Government Securities 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 Government Securities and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Government Securities Fund and John Hancock Government, you can compare the effects of market volatilities on Government Securities 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 Government Securities with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Government Securities and John Hancock.
Diversification Opportunities for Government Securities and John Hancock
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Government and John is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Government Securities Fund and John Hancock Government in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Government and Government Securities 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 Government Securities Fund 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 Government has no effect on the direction of Government Securities i.e., Government Securities and John Hancock go up and down completely randomly.
Pair Corralation between Government Securities and John Hancock
Assuming the 90 days horizon Government Securities Fund is expected to generate 0.72 times more return on investment than John Hancock. However, Government Securities Fund is 1.39 times less risky than John Hancock. It trades about -0.08 of its potential returns per unit of risk. John Hancock Government is currently generating about -0.07 per unit of risk. If you would invest 880.00 in Government Securities Fund on August 24, 2024 and sell it today you would lose (4.00) from holding Government Securities Fund or give up 0.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Government Securities Fund vs. John Hancock Government
Performance |
| Timeline |
| Government Securities |
| John Hancock Government |
Government Securities and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Government Securities and John Hancock
The main advantage of trading using opposite Government Securities and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Government Securities 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.| Government Securities vs. Vanguard Gnma Fund | Government Securities vs. Us Government Securities | Government Securities vs. Us Government Securities | Government Securities vs. American Funds Government |
| John Hancock vs. Vanguard Gnma Fund | John Hancock vs. Us Government Securities | John Hancock vs. Us Government Securities | John Hancock vs. American Funds Government |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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