Correlation Between Scout Mid and John Hancock
Can any of the company-specific risk be diversified away by investing in both Scout Mid 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 Scout Mid and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scout Mid Cap and John Hancock Financial, you can compare the effects of market volatilities on Scout Mid 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 Scout Mid with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scout Mid and John Hancock.
Diversification Opportunities for Scout Mid and John Hancock
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Scout and John is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Scout Mid Cap 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 Scout Mid 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 Scout Mid Cap 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 Scout Mid i.e., Scout Mid and John Hancock go up and down completely randomly.
Pair Corralation between Scout Mid and John Hancock
Assuming the 90 days horizon Scout Mid is expected to generate 1.67 times less return on investment than John Hancock. But when comparing it to its historical volatility, Scout Mid Cap is 2.09 times less risky than John Hancock. It trades about 0.46 of its potential returns per unit of risk. John Hancock Financial is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 3,378 in John Hancock Financial on September 4, 2024 and sell it today you would earn a total of 542.00 from holding John Hancock Financial or generate 16.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scout Mid Cap vs. John Hancock Financial
Performance |
| Timeline |
| Scout Mid Cap |
| John Hancock Financial |
Scout Mid and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scout Mid and John Hancock
The main advantage of trading using opposite Scout Mid and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scout Mid 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.| Scout Mid vs. John Hancock Financial | Scout Mid vs. Goldman Sachs Financial | Scout Mid vs. Mesirow Financial Small | Scout Mid vs. 1919 Financial Services |
| John Hancock vs. Tekla Life Sciences | John Hancock vs. Tekla World Healthcare | John Hancock vs. Tekla Healthcare Opportunities | John Hancock vs. Royce Value Closed |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |