Correlation Between John Hancock and Intermediate Term

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

By analyzing existing cross correlation between John Hancock Municipal and Intermediate Term Tax Free Bond, you can compare the effects of market volatilities on John Hancock and Intermediate Term 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 Intermediate Term. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Hancock and Intermediate Term.

Diversification Opportunities for John Hancock and Intermediate Term

0.82

Correlation Coefficient

John Hancock  Intermediate Term

Very poor diversification

The 3 months correlation between John and Intermediate is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding John Hancock Municipal and Intermediate Term Tax Free Bon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Term Tax 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 Municipal are associated (or correlated) with Intermediate Term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Term Tax has no effect on the direction of John Hancock i.e., John Hancock and Intermediate Term go up and down completely randomly.

Pair Corralation between John Hancock and Intermediate Term

Assuming the 90 days horizon John Hancock Municipal is expected to generate 0.81 times more return on investment than Intermediate Term. However, John Hancock Municipal is 1.23 times less risky than Intermediate Term. It trades about 0.26 of its potential returns per unit of risk. Intermediate Term Tax Free Bond is currently generating about 0.11 per unit of risk. If you would invest  993.00  in John Hancock Municipal on May 4, 2025 and sell it today you would earn a total of  17.00  from holding John Hancock Municipal or generate 1.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.41%
Values	Daily Returns

John Hancock Municipal  vs.  Intermediate Term Tax Free Bon

John Hancock Municipal

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Municipal are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, John Hancock is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intermediate Term Tax

Risk-Adjusted Performance

OK

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

Pair Trading with John Hancock and Intermediate Term

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

The idea behind John Hancock Municipal and Intermediate Term Tax Free Bond 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..