Correlation Between Vanguard Emerging and Jhancock Diversified
Can any of the company-specific risk be diversified away by investing in both Vanguard Emerging and Jhancock Diversified 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 Vanguard Emerging and Jhancock Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Emerging Markets and Jhancock Diversified Macro, you can compare the effects of market volatilities on Vanguard Emerging and Jhancock Diversified 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 Vanguard Emerging with a short position of Jhancock Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Emerging and Jhancock Diversified.
Diversification Opportunities for Vanguard Emerging and Jhancock Diversified
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Vanguard and Jhancock is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Emerging Markets and Jhancock Diversified Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Diversified and Vanguard Emerging 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 Vanguard Emerging Markets are associated (or correlated) with Jhancock Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Diversified has no effect on the direction of Vanguard Emerging i.e., Vanguard Emerging and Jhancock Diversified go up and down completely randomly.
Pair Corralation between Vanguard Emerging and Jhancock Diversified
Assuming the 90 days horizon Vanguard Emerging is expected to generate 1.14 times less return on investment than Jhancock Diversified. But when comparing it to its historical volatility, Vanguard Emerging Markets is 1.55 times less risky than Jhancock Diversified. It trades about 0.1 of its potential returns per unit of risk. Jhancock Diversified Macro is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 912.00 in Jhancock Diversified Macro on November 3, 2024 and sell it today you would earn a total of 7.00 from holding Jhancock Diversified Macro or generate 0.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Emerging Markets vs. Jhancock Diversified Macro
Performance |
| Timeline |
| Vanguard Emerging Markets |
| Jhancock Diversified |
Vanguard Emerging and Jhancock Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Emerging and Jhancock Diversified
The main advantage of trading using opposite Vanguard Emerging and Jhancock Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Emerging position performs unexpectedly, Jhancock Diversified 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 Diversified will offset losses from the drop in Jhancock Diversified's long position.| Vanguard Emerging vs. The Gabelli Healthcare | Vanguard Emerging vs. Health Care Ultrasector | Vanguard Emerging vs. Live Oak Health | Vanguard Emerging vs. Tekla Healthcare Investors |
| Jhancock Diversified vs. Vy Jpmorgan Emerging | Jhancock Diversified vs. Morgan Stanley Emerging | Jhancock Diversified vs. Mid Cap 15x Strategy | Jhancock Diversified vs. Siit Emerging Markets |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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