Correlation Between John Hancock and Brookfield Asset

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Can any of the company-specific risk be diversified away by investing in both John Hancock and Brookfield Asset 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 John Hancock and Brookfield Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Hancock Tax Advantaged and Brookfield Asset Management, you can compare the effects of market volatilities on John Hancock and Brookfield Asset 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 John Hancock with a short position of Brookfield Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Brookfield Asset.

Diversification Opportunities for John Hancock and Brookfield Asset

0.81
  Correlation Coefficient

Very poor diversification

The 3 months correlation between John and Brookfield is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Tax-Advantaged and Brookfield Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Asset Man and John Hancock 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 John Hancock Tax Advantaged are associated (or correlated) with Brookfield Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Asset Man has no effect on the direction of John Hancock i.e., John Hancock and Brookfield Asset go up and down completely randomly.

Pair Corralation between John Hancock and Brookfield Asset

Considering the 90-day investment horizon John Hancock Tax Advantaged is expected to generate 0.52 times more return on investment than Brookfield Asset. However, John Hancock Tax Advantaged is 1.93 times less risky than Brookfield Asset. It trades about 0.36 of its potential returns per unit of risk. Brookfield Asset Management is currently generating about 0.15 per unit of risk. If you would invest  498.00  in John Hancock Tax Advantaged on December 30, 2023 and sell it today you would earn a total of  26.00  from holding John Hancock Tax Advantaged or generate 5.22% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

John Hancock Tax-Advantaged  vs.  Brookfield Asset Management

 Performance 
       Timeline  
John Hancock Tax-adv 

Risk-Adjusted Performance

12 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Tax Advantaged are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly fragile basic indicators, John Hancock may actually be approaching a critical reversion point that can send shares even higher in April 2024.
Brookfield Asset Man 

Risk-Adjusted Performance

8 of 100

 
Low
 
High
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Brookfield Asset Management are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Brookfield Asset may actually be approaching a critical reversion point that can send shares even higher in April 2024.

John Hancock and Brookfield Asset Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with John Hancock and Brookfield Asset

The main advantage of trading using opposite John Hancock and Brookfield Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Hancock position performs unexpectedly, Brookfield Asset 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 Brookfield Asset will offset losses from the drop in Brookfield Asset's long position.
The idea behind John Hancock Tax Advantaged and Brookfield Asset Management 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.

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