Correlation Between Vaalco Energy and John Hancock

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

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

Diversification Opportunities for Vaalco Energy and John Hancock

0.49

Correlation Coefficient

Vaalco Energy  John Hancock

Very weak diversification

The 3 months correlation between Vaalco and John is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Vaalco Energy and John Hancock Enduring in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Enduring and Vaalco Energy 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 Vaalco Energy 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 Enduring has no effect on the direction of Vaalco Energy i.e., Vaalco Energy and John Hancock go up and down completely randomly.

Pair Corralation between Vaalco Energy and John Hancock

Considering the 90-day investment horizon Vaalco Energy is expected to generate 4.54 times more return on investment than John Hancock. However, Vaalco Energy is 4.54 times more volatile than John Hancock Enduring. It trades about 0.07 of its potential returns per unit of risk. John Hancock Enduring is currently generating about 0.06 per unit of risk. If you would invest  325.00  in Vaalco Energy on May 6, 2025 and sell it today you would earn a total of  35.00  from holding Vaalco Energy or generate 10.77% return on investment over 90 days.

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

Vaalco Energy  vs.  John Hancock Enduring

Vaalco Energy

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Vaalco Energy are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, Vaalco Energy showed solid returns over the last few months and may actually be approaching a breakup point.

John Hancock Enduring

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Enduring are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward 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 Vaalco Energy and John Hancock

The main advantage of trading using opposite Vaalco Energy and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vaalco Energy 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 Vaalco Energy and John Hancock Enduring 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.