Correlation Between Miller Opportunity and John Hancock
Can any of the company-specific risk be diversified away by investing in both Miller Opportunity 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 Miller Opportunity and John Hancock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miller Opportunity Trust and John Hancock Disciplined, you can compare the effects of market volatilities on Miller Opportunity 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 Miller Opportunity with a short position of John Hancock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miller Opportunity and John Hancock.
Diversification Opportunities for Miller Opportunity and John Hancock
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Miller and John is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Miller Opportunity Trust and John Hancock Disciplined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Hancock Disciplined and Miller Opportunity 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 Miller Opportunity Trust 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 Disciplined has no effect on the direction of Miller Opportunity i.e., Miller Opportunity and John Hancock go up and down completely randomly.
Pair Corralation between Miller Opportunity and John Hancock
Assuming the 90 days horizon Miller Opportunity Trust is expected to generate 1.49 times more return on investment than John Hancock. However, Miller Opportunity is 1.49 times more volatile than John Hancock Disciplined. It trades about -0.18 of its potential returns per unit of risk. John Hancock Disciplined is currently generating about -0.28 per unit of risk. If you would invest 3,331 in Miller Opportunity Trust on January 24, 2024 and sell it today you would lose (136.00) from holding Miller Opportunity Trust or give up 4.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Miller Opportunity Trust vs. John Hancock Disciplined
Performance |
| Timeline |
| Miller Opportunity Trust |
| John Hancock Disciplined |
Miller Opportunity and John Hancock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miller Opportunity and John Hancock
The main advantage of trading using opposite Miller Opportunity and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miller Opportunity 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.| Miller Opportunity vs. Miller Income Fund | Miller Opportunity vs. Miller Income Fund | Miller Opportunity vs. Miller Income Fund | Miller Opportunity vs. Miller Income Fund |
| John Hancock vs. New World Fund | John Hancock vs. Bond Fund Of | John Hancock vs. Washington Mutual Investors | John Hancock vs. Europacific Growth Fund |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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