Correlation Between Floating Rate and Pgim Jennison
Can any of the company-specific risk be diversified away by investing in both Floating Rate 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 Floating Rate and Pgim Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Floating Rate Fund and Pgim Jennison Technology, you can compare the effects of market volatilities on Floating Rate 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 Floating Rate with a short position of Pgim Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Floating Rate and Pgim Jennison.
Diversification Opportunities for Floating Rate and Pgim Jennison
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Floating and Pgim is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Floating Rate Fund 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 Floating Rate 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 Floating Rate Fund 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 Floating Rate i.e., Floating Rate and Pgim Jennison go up and down completely randomly.
Pair Corralation between Floating Rate and Pgim Jennison
Assuming the 90 days horizon Floating Rate is expected to generate 6.65 times less return on investment than Pgim Jennison. But when comparing it to its historical volatility, Floating Rate Fund is 9.08 times less risky than Pgim Jennison. It trades about 0.19 of its potential returns per unit of risk. Pgim Jennison Technology is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,544 in Pgim Jennison Technology on August 25, 2024 and sell it today you would earn a total of 106.00 from holding Pgim Jennison Technology or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Floating Rate Fund vs. Pgim Jennison Technology
Performance |
| Timeline |
| Floating Rate |
| Pgim Jennison Technology |
Floating Rate and Pgim Jennison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Floating Rate and Pgim Jennison
The main advantage of trading using opposite Floating Rate and Pgim Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Floating Rate 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.| Floating Rate vs. Pgim Jennison Technology | Floating Rate vs. Global Technology Portfolio | Floating Rate vs. Science Technology Fund | Floating Rate vs. Icon Information Technology |
| Pgim Jennison vs. VEEA | Pgim Jennison vs. VivoPower International PLC | Pgim Jennison vs. WEBTOON Entertainment Common | Pgim Jennison vs. Pgim Jennison International |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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