Correlation Between Pgim Jennison and Franklin Dynatech
Can any of the company-specific risk be diversified away by investing in both Pgim Jennison and Franklin Dynatech 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 Pgim Jennison and Franklin Dynatech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pgim Jennison Technology and Franklin Dynatech Fund, you can compare the effects of market volatilities on Pgim Jennison and Franklin Dynatech 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 Pgim Jennison with a short position of Franklin Dynatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pgim Jennison and Franklin Dynatech.
Diversification Opportunities for Pgim Jennison and Franklin Dynatech
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PGIM and Franklin is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Pgim Jennison Technology and Franklin Dynatech Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Dynatech and Pgim 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 Pgim Jennison Technology are associated (or correlated) with Franklin Dynatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Dynatech has no effect on the direction of Pgim Jennison i.e., Pgim Jennison and Franklin Dynatech go up and down completely randomly.
Pair Corralation between Pgim Jennison and Franklin Dynatech
Assuming the 90 days horizon Pgim Jennison Technology is expected to generate 1.24 times more return on investment than Franklin Dynatech. However, Pgim Jennison is 1.24 times more volatile than Franklin Dynatech Fund. It trades about 0.09 of its potential returns per unit of risk. Franklin Dynatech Fund is currently generating about 0.09 per unit of risk. If you would invest 1,321 in Pgim Jennison Technology on November 27, 2024 and sell it today you would earn a total of 1,159 from holding Pgim Jennison Technology or generate 87.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pgim Jennison Technology vs. Franklin Dynatech Fund
Performance |
| Timeline |
| Pgim Jennison Technology |
| Franklin Dynatech |
Pgim Jennison and Franklin Dynatech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pgim Jennison and Franklin Dynatech
The main advantage of trading using opposite Pgim Jennison and Franklin Dynatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pgim Jennison position performs unexpectedly, Franklin Dynatech 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 Dynatech will offset losses from the drop in Franklin Dynatech's long position.| Pgim Jennison vs. Lord Abbett Diversified | Pgim Jennison vs. Jhancock Diversified Macro | Pgim Jennison vs. Aqr Diversified Arbitrage | Pgim Jennison vs. Stone Ridge Diversified |
| Franklin Dynatech vs. Franklin Adjustable Government | Franklin Dynatech vs. John Hancock Government | Franklin Dynatech vs. Government Securities Fund | Franklin Dynatech vs. Us Government Securities |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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