Correlation Between Amg Managers and John Hancock

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

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

Diversification Opportunities for Amg Managers and John Hancock

0.92

Correlation Coefficient

Amg Managers  John Hancock

Almost no diversification

The 3 months correlation between Amg and John is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Amg Managers Skyline and John Hancock Disciplined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Disciplined and Amg Managers 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 Amg Managers Skyline 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 Disciplined has no effect on the direction of Amg Managers i.e., Amg Managers and John Hancock go up and down completely randomly.

Pair Corralation between Amg Managers and John Hancock

Assuming the 90 days horizon Amg Managers Skyline is expected to generate 1.64 times more return on investment than John Hancock. However, Amg Managers is 1.64 times more volatile than John Hancock Disciplined. It trades about 0.18 of its potential returns per unit of risk. John Hancock Disciplined is currently generating about 0.01 per unit of risk. If you would invest  3,172  in Amg Managers Skyline on September 13, 2024 and sell it today you would earn a total of  341.00  from holding Amg Managers Skyline or generate 10.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	97.67%
Values	Daily Returns

Amg Managers Skyline  vs.  John Hancock Disciplined

Amg Managers Skyline

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Amg Managers Skyline are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Amg Managers may actually be approaching a critical reversion point that can send shares even higher in January 2025.

John Hancock Disciplined

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Disciplined are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, John Hancock is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Amg Managers and John Hancock

The main advantage of trading using opposite Amg Managers and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Managers 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 Amg Managers Skyline and John Hancock Disciplined 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.