Correlation Between John Hancock and Betapro Canadian

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Can any of the company-specific risk be diversified away by investing in both John Hancock and Betapro Canadian 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 John Hancock and Betapro Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Funds and Betapro Canadian Gold, you can compare the effects of market volatilities on John Hancock and Betapro Canadian 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 John Hancock with a short position of Betapro Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Betapro Canadian.

Diversification Opportunities for John Hancock and Betapro Canadian

0.18
  Correlation Coefficient

Average diversification

The 3 months correlation between JLKLX and Betapro is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Funds and Betapro Canadian Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Betapro Canadian Gold and John Hancock 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 John Hancock Funds are associated (or correlated) with Betapro Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Betapro Canadian Gold has no effect on the direction of John Hancock i.e., John Hancock and Betapro Canadian go up and down completely randomly.

Pair Corralation between John Hancock and Betapro Canadian

Assuming the 90 days horizon John Hancock Funds is expected to generate 0.26 times more return on investment than Betapro Canadian. However, John Hancock Funds is 3.92 times less risky than Betapro Canadian. It trades about 0.02 of its potential returns per unit of risk. Betapro Canadian Gold is currently generating about -0.02 per unit of risk. If you would invest  1,006  in John Hancock Funds on May 11, 2022 and sell it today you would earn a total of  118.00  from holding John Hancock Funds or generate 11.73% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

John Hancock Funds  vs.  Betapro Canadian Gold

 Performance (%) 
       Timeline  
John Hancock Funds 
JLKLX Performance
4 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Funds are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, John Hancock is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

JLKLX Price Channel

Betapro Canadian Gold 
Betapro Performance
0 of 100
Over the last 90 days Betapro Canadian Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Betapro Canadian is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Betapro Price Channel

John Hancock and Betapro Canadian Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with John Hancock and Betapro Canadian

The main advantage of trading using opposite John Hancock and Betapro Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Betapro Canadian 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 Betapro Canadian will offset losses from the drop in Betapro Canadian's long position.

John Hancock Funds

Pair trading matchups for John Hancock

Alphabet vs. John Hancock
Tencent Holdings vs. John Hancock
Agnico-Eagle Mines vs. John Hancock
Ubiquiti Networks vs. John Hancock
Hyliion Hldg vs. John Hancock
Blink Charging vs. John Hancock
Tesla vs. John Hancock
Ultralife Corp vs. John Hancock
Enbridge vs. John Hancock
Salesforce vs. John Hancock
Microsoft Corp vs. John Hancock
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against John Hancock as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. John Hancock's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, John Hancock's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to John Hancock Funds.
The idea behind John Hancock Funds and Betapro Canadian Gold 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.

Betapro Canadian Gold

Pair trading matchups for Betapro Canadian

Amazon vs. Betapro Canadian
Ubiquiti Networks vs. Betapro Canadian
Microsoft Corp vs. Betapro Canadian
Tencent Holdings vs. Betapro Canadian
Salesforce vs. Betapro Canadian
Exxon vs. Betapro Canadian
Enbridge vs. Betapro Canadian
Agnico-Eagle Mines vs. Betapro Canadian
Ultralife Corp vs. Betapro Canadian
Coca Cola vs. Betapro Canadian
Otp Bank vs. Betapro Canadian
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Betapro Canadian as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Betapro Canadian's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Betapro Canadian's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Betapro Canadian Gold.
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 Watchlist Optimization module to optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm.

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