Correlation Between Qs Global and Jhancock Global

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

By analyzing existing cross correlation between Qs Global Equity and Jhancock Global Equity, you can compare the effects of market volatilities on Qs Global and Jhancock Global 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 Qs Global with a short position of Jhancock Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qs Global and Jhancock Global.

Diversification Opportunities for Qs Global and Jhancock Global

0.68

Correlation Coefficient

Qs Global  Jhancock Global

Poor diversification

The 3 months correlation between SMYIX and Jhancock is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Qs Global Equity and Jhancock Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Global Equity and Qs Global 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 Qs Global Equity are associated (or correlated) with Jhancock Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Global Equity has no effect on the direction of Qs Global i.e., Qs Global and Jhancock Global go up and down completely randomly.

Pair Corralation between Qs Global and Jhancock Global

Assuming the 90 days horizon Qs Global Equity is expected to generate 1.2 times more return on investment than Jhancock Global. However, Qs Global is 1.2 times more volatile than Jhancock Global Equity. It trades about 0.2 of its potential returns per unit of risk. Jhancock Global Equity is currently generating about 0.05 per unit of risk. If you would invest  2,394  in Qs Global Equity on September 12, 2024 and sell it today you would earn a total of  200.00  from holding Qs Global Equity or generate 8.35% return on investment over 90 days.

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

Qs Global Equity  vs.  Jhancock Global Equity

Qs Global Equity

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Qs Global Equity are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Qs Global may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jhancock Global Equity

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jhancock Global Equity are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Jhancock Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Qs Global and Jhancock Global

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

The idea behind Qs Global Equity and Jhancock Global Equity 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.