Correlation Between Amg Managers and Prudential Global
Can any of the company-specific risk be diversified away by investing in both Amg Managers and Prudential 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 Amg Managers and Prudential Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Managers Loomis and Prudential Global Total, you can compare the effects of market volatilities on Amg Managers and Prudential 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 Amg Managers with a short position of Prudential Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Managers and Prudential Global.
Diversification Opportunities for Amg Managers and Prudential Global
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amg and Prudential is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Amg Managers Loomis and Prudential Global Total in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Global Total and Amg Managers 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 Amg Managers Loomis are associated (or correlated) with Prudential Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Global Total has no effect on the direction of Amg Managers i.e., Amg Managers and Prudential Global go up and down completely randomly.
Pair Corralation between Amg Managers and Prudential Global
Assuming the 90 days horizon Amg Managers Loomis is expected to generate 0.83 times more return on investment than Prudential Global. However, Amg Managers Loomis is 1.2 times less risky than Prudential Global. It trades about 0.05 of its potential returns per unit of risk. Prudential Global Total is currently generating about -0.02 per unit of risk. If you would invest 2,171 in Amg Managers Loomis on August 31, 2024 and sell it today you would earn a total of 9.00 from holding Amg Managers Loomis or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg Managers Loomis vs. Prudential Global Total
Performance |
| Timeline |
| Amg Managers Loomis |
| Prudential Global Total |
Amg Managers and Prudential Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Managers and Prudential Global
The main advantage of trading using opposite Amg Managers and Prudential Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Managers position performs unexpectedly, Prudential 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 Prudential Global will offset losses from the drop in Prudential Global's long position.| Amg Managers vs. Pear Tree Polaris | Amg Managers vs. Kinetics Small Cap | Amg Managers vs. Tcw Total Return | Amg Managers vs. Thornburg International Value |
| Prudential Global vs. Rbc Emerging Markets | Prudential Global vs. Western Asset Diversified | Prudential Global vs. Origin Emerging Markets | Prudential Global vs. Siit Emerging Markets |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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