Correlation Between Walker Dunlop and John Hancock

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

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

Diversification Opportunities for Walker Dunlop and John Hancock

0.09
  Correlation Coefficient
Walker Dunlop
John Hancock Disciplined

Significant diversification

The 3 months correlation between Walker and JDITX is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop 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 Walker Dunlop 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 Walker Dunlop 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 Walker Dunlop i.e., Walker Dunlop and John Hancock go up and down completely randomly.

Pair Corralation between Walker Dunlop and John Hancock

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 2.55 times more return on investment than John Hancock. However, Walker Dunlop is 2.55 times more volatile than John Hancock Disciplined. It trades about 0.06 of its potential returns per unit of risk. John Hancock Disciplined is currently generating about 0.04 per unit of risk. If you would invest  6,294  in Walker Dunlop on July 18, 2021 and sell it today you would earn a total of  6,340  from holding Walker Dunlop or generate 100.73% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy99.6%
ValuesDaily Returns

Walker Dunlop  vs.  John Hancock Disciplined

 Performance (%) 
      Timeline 
Walker Dunlop 
 Walker Performance
15 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Walker Dunlop are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain fundamental indicators, Walker Dunlop exhibited solid returns over the last few months and may actually be approaching a breakup point.

Walker Price Channel

John Hancock Disciplined 
 JDITX Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in John Hancock Disciplined are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, John Hancock is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Walker Dunlop and John Hancock Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Walker Dunlop and John Hancock

The main advantage of trading using opposite Walker Dunlop and John Hancock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop 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 Walker Dunlop and John Hancock Disciplined 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

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