Correlation Between M Large and John Hancock
Can any of the company-specific risk be diversified away by investing in both M Large 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 M Large and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between M Large Cap and John Hancock Strategic, you can compare the effects of market volatilities on M Large 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 M Large with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of M Large and John Hancock.
Diversification Opportunities for M Large and John Hancock
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between MTCGX and John is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding M Large Cap and John Hancock Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Strategic and M Large 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 M Large Cap 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 Strategic has no effect on the direction of M Large i.e., M Large and John Hancock go up and down completely randomly.
Pair Corralation between M Large and John Hancock
Assuming the 90 days horizon M Large Cap is expected to generate 1.11 times more return on investment than John Hancock. However, M Large is 1.11 times more volatile than John Hancock Strategic. It trades about 0.27 of its potential returns per unit of risk. John Hancock Strategic is currently generating about 0.28 per unit of risk. If you would invest 2,943 in M Large Cap on April 15, 2025 and sell it today you would earn a total of 645.00 from holding M Large Cap or generate 21.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
M Large Cap vs. John Hancock Strategic
Performance |
| Timeline |
| M Large Cap |
| John Hancock Strategic |
M Large and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with M Large and John Hancock
The main advantage of trading using opposite M Large and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if M Large 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.| M Large vs. Blackrock Science Technology | M Large vs. Goldman Sachs Technology | M Large vs. Columbia Global Technology | M Large vs. Hennessy Technology Fund |
| John Hancock vs. Highland Longshort Healthcare | John Hancock vs. Eventide Healthcare Life | John Hancock vs. Allianzgi Health Sciences | John Hancock vs. Fidelity Advisor Health |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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