Correlation Between Ultrashort Japan and John Hancock
Can any of the company-specific risk be diversified away by investing in both Ultrashort Japan 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 Ultrashort Japan and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultrashort Japan Profund and John Hancock Financial, you can compare the effects of market volatilities on Ultrashort Japan 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 Ultrashort Japan with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultrashort Japan and John Hancock.
Diversification Opportunities for Ultrashort Japan and John Hancock
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ultrashort and John is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Ultrashort Japan Profund and John Hancock Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Financial and Ultrashort Japan 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 Ultrashort Japan Profund 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 Financial has no effect on the direction of Ultrashort Japan i.e., Ultrashort Japan and John Hancock go up and down completely randomly.
Pair Corralation between Ultrashort Japan and John Hancock
Assuming the 90 days horizon Ultrashort Japan is expected to generate 26.21 times less return on investment than John Hancock. In addition to that, Ultrashort Japan is 1.24 times more volatile than John Hancock Financial. It trades about 0.01 of its total potential returns per unit of risk. John Hancock Financial is currently generating about 0.33 per unit of volatility. If you would invest 3,409 in John Hancock Financial on August 27, 2024 and sell it today you would earn a total of 486.00 from holding John Hancock Financial or generate 14.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ultrashort Japan Profund vs. John Hancock Financial
Performance |
| Timeline |
| Ultrashort Japan Profund |
| John Hancock Financial |
Ultrashort Japan and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultrashort Japan and John Hancock
The main advantage of trading using opposite Ultrashort Japan and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultrashort Japan 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.| Ultrashort Japan vs. John Hancock Financial | Ultrashort Japan vs. Prudential Jennison Financial | Ultrashort Japan vs. Angel Oak Financial | Ultrashort Japan vs. Financials Ultrasector Profund |
| John Hancock vs. Tekla World Healthcare | John Hancock vs. Tekla Healthcare Opportunities | John Hancock vs. Royce Value Closed | John Hancock vs. Cohen Steers Reit |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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