Correlation Between Pgim Jennison and Mfs Technology
Can any of the company-specific risk be diversified away by investing in both Pgim Jennison and Mfs Technology 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 Mfs Technology 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 Mfs Technology Fund, you can compare the effects of market volatilities on Pgim Jennison and Mfs Technology 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 Mfs Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pgim Jennison and Mfs Technology.
Diversification Opportunities for Pgim Jennison and Mfs Technology
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Pgim and Mfs is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Pgim Jennison Technology and Mfs Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Technology 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 Mfs Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Technology has no effect on the direction of Pgim Jennison i.e., Pgim Jennison and Mfs Technology go up and down completely randomly.
Pair Corralation between Pgim Jennison and Mfs Technology
Assuming the 90 days horizon Pgim Jennison Technology is expected to generate 1.21 times more return on investment than Mfs Technology. However, Pgim Jennison is 1.21 times more volatile than Mfs Technology Fund. It trades about 0.1 of its potential returns per unit of risk. Mfs Technology Fund is currently generating about 0.09 per unit of risk. If you would invest 1,330 in Pgim Jennison Technology on September 1, 2024 and sell it today you would earn a total of 1,306 from holding Pgim Jennison Technology or generate 98.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.78% |
| Values | Daily Returns |
Pgim Jennison Technology vs. Mfs Technology Fund
Performance |
| Timeline |
| Pgim Jennison Technology |
| Mfs Technology |
Pgim Jennison and Mfs Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pgim Jennison and Mfs Technology
The main advantage of trading using opposite Pgim Jennison and Mfs Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pgim Jennison position performs unexpectedly, Mfs Technology 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 Mfs Technology will offset losses from the drop in Mfs Technology's long position.| Pgim Jennison vs. Pace Smallmedium Value | Pgim Jennison vs. Vanguard Small Cap Value | Pgim Jennison vs. Victory Rs Partners | Pgim Jennison vs. Great West Loomis Sayles |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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