Correlation Between Janus Short-term and Janus Henderson

Can any of the company-specific risk be diversified away by investing in both Janus Short-term and Janus Henderson 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 Janus Short-term and Janus Henderson into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Janus Short Term Bond and Janus Henderson High Yield, you can compare the effects of market volatilities on Janus Short-term and Janus Henderson 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 Janus Short-term with a short position of Janus Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Janus Short-term and Janus Henderson.

Diversification Opportunities for Janus Short-term and Janus Henderson

0.24

Correlation Coefficient

Janus Short-term  Janus Henderson

Modest diversification

The 3 months correlation between Janus and Janus is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Janus Short Term Bond and Janus Henderson High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Henderson High and Janus Short-term 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 Janus Short Term Bond are associated (or correlated) with Janus Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Henderson High has no effect on the direction of Janus Short-term i.e., Janus Short-term and Janus Henderson go up and down completely randomly.

Pair Corralation between Janus Short-term and Janus Henderson

Assuming the 90 days horizon Janus Short-term is expected to generate 217.0 times less return on investment than Janus Henderson. But when comparing it to its historical volatility, Janus Short Term Bond is 1.02 times less risky than Janus Henderson. It trades about 0.0 of its potential returns per unit of risk. Janus Henderson High Yield is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  731.00  in Janus Henderson High Yield on September 5, 2024 and sell it today you would earn a total of  10.00  from holding Janus Henderson High Yield or generate 1.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Janus Short Term Bond  vs.  Janus Henderson High Yield

Janus Short Term

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Janus Short Term Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Janus Short-term is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Janus Henderson High

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Janus Henderson High Yield are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Janus Henderson is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Janus Short-term and Janus Henderson

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

The idea behind Janus Short Term Bond and Janus Henderson High Yield 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.