Correlation Between IHIT and Pgim Global
Can any of the company-specific risk be diversified away by investing in both IHIT and Pgim Global 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 IHIT and Pgim Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IHIT and Pgim Global High, you can compare the effects of market volatilities on IHIT and Pgim Global 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 IHIT with a short position of Pgim Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of IHIT and Pgim Global.
Diversification Opportunities for IHIT and Pgim Global
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IHIT and Pgim is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding IHIT and Pgim Global High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Global High and IHIT 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 IHIT are associated (or correlated) with Pgim Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pgim Global High has no effect on the direction of IHIT i.e., IHIT and Pgim Global go up and down completely randomly.
Pair Corralation between IHIT and Pgim Global
Given the investment horizon of 90 days IHIT is expected to under-perform the Pgim Global. But the etf apears to be less risky and, when comparing its historical volatility, IHIT is 1.44 times less risky than Pgim Global. The etf trades about -0.06 of its potential returns per unit of risk. The Pgim Global High is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 890.00 in Pgim Global High on August 30, 2024 and sell it today you would earn a total of 371.00 from holding Pgim Global High or generate 41.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 31.11% |
| Values | Daily Returns |
IHIT vs. Pgim Global High
Performance |
| Timeline |
| IHIT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Pgim Global High |
IHIT and Pgim Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IHIT and Pgim Global
The main advantage of trading using opposite IHIT and Pgim Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IHIT position performs unexpectedly, Pgim Global 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 Global will offset losses from the drop in Pgim Global's long position.| IHIT vs. MFS Investment Grade | IHIT vs. Eaton Vance National | IHIT vs. Invesco High Income | IHIT vs. Nuveen California Select |
| Pgim Global vs. Gabelli Global Small | Pgim Global vs. MFS Investment Grade | Pgim Global vs. Eaton Vance National | Pgim Global vs. GAMCO Natural Resources |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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