Correlation Between Prudential Emerging and Pgim Jennison
Can any of the company-specific risk be diversified away by investing in both Prudential Emerging 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 Prudential Emerging and Pgim Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Emerging Markets and Pgim Jennison Diversified, you can compare the effects of market volatilities on Prudential Emerging 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 Prudential Emerging with a short position of Pgim Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Emerging and Pgim Jennison.
Diversification Opportunities for Prudential Emerging and Pgim Jennison
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Prudential and Pgim is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Emerging Markets and Pgim Jennison Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Jennison Diversified and Prudential Emerging 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 Prudential Emerging Markets 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 Diversified has no effect on the direction of Prudential Emerging i.e., Prudential Emerging and Pgim Jennison go up and down completely randomly.
Pair Corralation between Prudential Emerging and Pgim Jennison
Assuming the 90 days horizon Prudential Emerging is expected to generate 5.31 times less return on investment than Pgim Jennison. But when comparing it to its historical volatility, Prudential Emerging Markets is 2.5 times less risky than Pgim Jennison. It trades about 0.05 of its potential returns per unit of risk. Pgim Jennison Diversified is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,171 in Pgim Jennison Diversified on August 28, 2024 and sell it today you would earn a total of 963.00 from holding Pgim Jennison Diversified or generate 82.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Emerging Markets vs. Pgim Jennison Diversified
Performance |
| Timeline |
| Prudential Emerging |
| Pgim Jennison Diversified |
Prudential Emerging and Pgim Jennison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Emerging and Pgim Jennison
The main advantage of trading using opposite Prudential Emerging and Pgim Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Emerging 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.| Prudential Emerging vs. Franklin High Yield | Prudential Emerging vs. Nuveen Minnesota Municipal | Prudential Emerging vs. T Rowe Price | Prudential Emerging vs. T Rowe Price |
| Pgim Jennison vs. Franklin Natural Resources | Pgim Jennison vs. Goehring Rozencwajg Resources | Pgim Jennison vs. Calvert Global Energy | Pgim Jennison vs. Short Oil Gas |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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