Correlation Between Prudential Jennison and Franklin Gold
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Franklin Gold 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 Jennison and Franklin Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Jennison Financial and Franklin Gold Precious, you can compare the effects of market volatilities on Prudential Jennison and Franklin Gold 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 Jennison with a short position of Franklin Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Franklin Gold.
Diversification Opportunities for Prudential Jennison and Franklin Gold
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Prudential and Franklin is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Financial and Franklin Gold Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Gold Precious and Prudential Jennison 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 Jennison Financial are associated (or correlated) with Franklin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Gold Precious has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Franklin Gold go up and down completely randomly.
Pair Corralation between Prudential Jennison and Franklin Gold
Assuming the 90 days horizon Prudential Jennison Financial is expected to generate 0.83 times more return on investment than Franklin Gold. However, Prudential Jennison Financial is 1.21 times less risky than Franklin Gold. It trades about 0.21 of its potential returns per unit of risk. Franklin Gold Precious is currently generating about -0.28 per unit of risk. If you would invest 2,528 in Prudential Jennison Financial on August 27, 2024 and sell it today you would earn a total of 186.00 from holding Prudential Jennison Financial or generate 7.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Jennison Financial vs. Franklin Gold Precious
Performance |
| Timeline |
| Prudential Jennison |
| Franklin Gold Precious |
Prudential Jennison and Franklin Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Franklin Gold
The main advantage of trading using opposite Prudential Jennison and Franklin Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Franklin Gold 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 Franklin Gold will offset losses from the drop in Franklin Gold's long position.| Prudential Jennison vs. Sprott Gold Equity | Prudential Jennison vs. Short Precious Metals | Prudential Jennison vs. Global Gold Fund | Prudential Jennison vs. Fidelity Advisor Gold |
| Franklin Gold vs. Ab E Opportunities | Franklin Gold vs. Eic Value Fund | Franklin Gold vs. T Rowe Price | Franklin Gold vs. Archer Balanced Fund |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |