Correlation Between Victory Rs and Jhancock Multi

Can any of the company-specific risk be diversified away by investing in both Victory Rs and Jhancock Multi 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 Victory Rs and Jhancock Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Victory Rs Partners and Jhancock Multi Index 2065, you can compare the effects of market volatilities on Victory Rs and Jhancock Multi 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 Victory Rs with a short position of Jhancock Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Rs and Jhancock Multi.

Diversification Opportunities for Victory Rs and Jhancock Multi

0.85

Correlation Coefficient

Victory Rs  Jhancock Multi

Very poor diversification

The 3 months correlation between Victory and Jhancock is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Victory Rs Partners and Jhancock Multi Index 2065 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Multi Index and Victory Rs 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 Victory Rs Partners are associated (or correlated) with Jhancock Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Multi Index has no effect on the direction of Victory Rs i.e., Victory Rs and Jhancock Multi go up and down completely randomly.

Pair Corralation between Victory Rs and Jhancock Multi

Assuming the 90 days horizon Victory Rs is expected to generate 2.07 times less return on investment than Jhancock Multi. In addition to that, Victory Rs is 1.55 times more volatile than Jhancock Multi Index 2065. It trades about 0.05 of its total potential returns per unit of risk. Jhancock Multi Index 2065 is currently generating about 0.17 per unit of volatility. If you would invest  1,494  in Jhancock Multi Index 2065 on September 13, 2024 and sell it today you would earn a total of  23.00  from holding Jhancock Multi Index 2065 or generate 1.54% return on investment over 90 days.

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

Victory Rs Partners  vs.  Jhancock Multi Index 2065

Victory Rs Partners

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Victory Rs Partners are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak primary indicators, Victory Rs may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jhancock Multi Index

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Jhancock Multi Index 2065 are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Jhancock Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Victory Rs and Jhancock Multi

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

The idea behind Victory Rs Partners and Jhancock Multi Index 2065 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.