Correlation Between Manulife Financial and Richards Packaging

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

By analyzing existing cross correlation between Manulife Financial Corp and Richards Packaging Income, you can compare the effects of market volatilities on Manulife Financial and Richards Packaging 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 Manulife Financial with a short position of Richards Packaging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Financial and Richards Packaging.

Diversification Opportunities for Manulife Financial and Richards Packaging

-0.67

Correlation Coefficient

Manulife Financial  Richards Packaging

Excellent diversification

The 3 months correlation between Manulife and Richards is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Financial Corp and Richards Packaging Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Richards Packaging Income and Manulife Financial 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 Manulife Financial Corp are associated (or correlated) with Richards Packaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Richards Packaging Income has no effect on the direction of Manulife Financial i.e., Manulife Financial and Richards Packaging go up and down completely randomly.

Pair Corralation between Manulife Financial and Richards Packaging

Assuming the 90 days trading horizon Manulife Financial Corp is expected to under-perform the Richards Packaging. In addition to that, Manulife Financial is 1.1 times more volatile than Richards Packaging Income. It trades about -0.06 of its total potential returns per unit of risk. Richards Packaging Income is currently generating about 0.17 per unit of volatility. If you would invest  2,888  in Richards Packaging Income on May 19, 2025 and sell it today you would earn a total of  349.00  from holding Richards Packaging Income or generate 12.08% return on investment over 90 days.

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

Manulife Financial Corp  vs.  Richards Packaging Income

Manulife Financial Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Manulife Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Manulife Financial is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Richards Packaging Income

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Richards Packaging Income are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating forward indicators, Richards Packaging may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Manulife Financial and Richards Packaging

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

The idea behind Manulife Financial Corp and Richards Packaging Income 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.