Correlation Between Baillie Gifford and Pgim Jennison
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Pgim Jennison 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 Baillie Gifford and Pgim Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford Health and Pgim Jennison Technology, you can compare the effects of market volatilities on Baillie Gifford and Pgim Jennison 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 Baillie Gifford with a short position of Pgim Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Pgim Jennison.
Diversification Opportunities for Baillie Gifford and Pgim Jennison
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baillie and Pgim is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Pgim Jennison Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Jennison Technology and Baillie Gifford 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 Baillie Gifford Health are associated (or correlated) with Pgim Jennison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pgim Jennison Technology has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Pgim Jennison go up and down completely randomly.
Pair Corralation between Baillie Gifford and Pgim Jennison
Assuming the 90 days horizon Baillie Gifford Health is expected to under-perform the Pgim Jennison. But the mutual fund apears to be less risky and, when comparing its historical volatility, Baillie Gifford Health is 1.19 times less risky than Pgim Jennison. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Pgim Jennison Technology is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,338 in Pgim Jennison Technology on October 25, 2024 and sell it today you would earn a total of 1,376 from holding Pgim Jennison Technology or generate 102.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Pgim Jennison Technology
Performance |
| Timeline |
| Baillie Gifford Health |
| Pgim Jennison Technology |
Baillie Gifford and Pgim Jennison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Pgim Jennison
The main advantage of trading using opposite Baillie Gifford and Pgim Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Pgim Jennison 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 Pgim Jennison will offset losses from the drop in Pgim Jennison's long position.| Baillie Gifford vs. Rbc Small Cap | Baillie Gifford vs. Kinetics Small Cap | Baillie Gifford vs. Ab Small Cap | Baillie Gifford vs. Tax Managed Mid Small |
| Pgim Jennison vs. Smallcap Fund Fka | Pgim Jennison vs. Glg Intl Small | Pgim Jennison vs. Kinetics Small Cap | Pgim Jennison vs. Vy Columbia Small |
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.
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