Correlation Between Eaton Vance and Prudential Government
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Prudential Government 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 Eaton Vance and Prudential Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Ohio and Prudential Government Money, you can compare the effects of market volatilities on Eaton Vance and Prudential Government 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 Eaton Vance with a short position of Prudential Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Prudential Government.
Diversification Opportunities for Eaton Vance and Prudential Government
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eaton and Prudential is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Ohio and Prudential Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Government and Eaton Vance 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 Eaton Vance Ohio are associated (or correlated) with Prudential Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Government has no effect on the direction of Eaton Vance i.e., Eaton Vance and Prudential Government go up and down completely randomly.
Pair Corralation between Eaton Vance and Prudential Government
Assuming the 90 days horizon Eaton Vance Ohio is expected to generate 0.42 times more return on investment than Prudential Government. However, Eaton Vance Ohio is 2.37 times less risky than Prudential Government. It trades about 0.07 of its potential returns per unit of risk. Prudential Government Money is currently generating about 0.0 per unit of risk. If you would invest 781.00 in Eaton Vance Ohio on September 12, 2024 and sell it today you would earn a total of 60.00 from holding Eaton Vance Ohio or generate 7.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 90.08% |
| Values | Daily Returns |
Eaton Vance Ohio vs. Prudential Government Money
Performance |
| Timeline |
| Eaton Vance Ohio |
| Prudential Government |
Eaton Vance and Prudential Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Prudential Government
The main advantage of trading using opposite Eaton Vance and Prudential Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Prudential Government 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 Prudential Government will offset losses from the drop in Prudential Government's long position.| Eaton Vance vs. Prudential Government Money | Eaton Vance vs. Chestnut Street Exchange | Eaton Vance vs. Aig Government Money | Eaton Vance vs. Franklin Government Money |
| Prudential Government vs. Strategic Allocation Moderate | Prudential Government vs. Qs Moderate Growth | Prudential Government vs. Fidelity Managed Retirement | Prudential Government vs. Sa Worldwide Moderate |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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