Correlation Between Aquagold International and John Hancock

Can any of the company-specific risk be diversified away by investing in both Aquagold International 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 Aquagold International and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aquagold International and John Hancock Multifactor, you can compare the effects of market volatilities on Aquagold International 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 Aquagold International with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and John Hancock.

Diversification Opportunities for Aquagold International and John Hancock

0.0

Correlation Coefficient

Aquagold International  John Hancock

Pay attention - limited upside

The 3 months correlation between Aquagold and John is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and John Hancock Multifactor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Multifactor and Aquagold International 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 Aquagold International 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 Multifactor has no effect on the direction of Aquagold International i.e., Aquagold International and John Hancock go up and down completely randomly.

Pair Corralation between Aquagold International and John Hancock

Given the investment horizon of 90 days Aquagold International is expected to under-perform the John Hancock. In addition to that, Aquagold International is 9.41 times more volatile than John Hancock Multifactor. It trades about -0.04 of its total potential returns per unit of risk. John Hancock Multifactor is currently generating about 0.17 per unit of volatility. If you would invest  5,242  in John Hancock Multifactor on February 24, 2024 and sell it today you would earn a total of  1,172  from holding John Hancock Multifactor or generate 22.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.4%
Values	Daily Returns

Aquagold International  vs.  John Hancock Multifactor

Aquagold International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aquagold International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Aquagold International is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

John Hancock Multifactor

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Multifactor are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent primary indicators, John Hancock is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Aquagold International and John Hancock

The main advantage of trading using opposite Aquagold International and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International 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.

The idea behind Aquagold International and John Hancock Multifactor pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.