Correlation Between John Hancock and Dreyfusthe Boston

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

By analyzing existing cross correlation between John Hancock Financial and Dreyfusthe Boston Pany, you can compare the effects of market volatilities on John Hancock and Dreyfusthe Boston 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 Dreyfusthe Boston. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Dreyfusthe Boston.

Diversification Opportunities for John Hancock and Dreyfusthe Boston

0.94

Correlation Coefficient

John Hancock  Dreyfusthe Boston

Almost no diversification

The 3 months correlation between John and Dreyfusthe is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Financial and Dreyfusthe Boston Pany in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfusthe Boston Pany 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 Financial are associated (or correlated) with Dreyfusthe Boston. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfusthe Boston Pany has no effect on the direction of John Hancock i.e., John Hancock and Dreyfusthe Boston go up and down completely randomly.

Pair Corralation between John Hancock and Dreyfusthe Boston

Considering the 90-day investment horizon John Hancock is expected to generate 1.06 times less return on investment than Dreyfusthe Boston. In addition to that, John Hancock is 1.6 times more volatile than Dreyfusthe Boston Pany. It trades about 0.03 of its total potential returns per unit of risk. Dreyfusthe Boston Pany is currently generating about 0.05 per unit of volatility. If you would invest  3,148  in Dreyfusthe Boston Pany on September 26, 2024 and sell it today you would earn a total of  988.00  from holding Dreyfusthe Boston Pany or generate 31.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	99.8%
Values	Daily Returns

John Hancock Financial  vs.  Dreyfusthe Boston Pany

John Hancock Financial

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Financial are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of very conflicting basic indicators, John Hancock may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Dreyfusthe Boston Pany

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dreyfusthe Boston Pany are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Dreyfusthe Boston may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with John Hancock and Dreyfusthe Boston

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

The idea behind John Hancock Financial and Dreyfusthe Boston Pany 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.

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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 Valuation module to check real value of public entities based on technical and fundamental data.