Correlation Between Pgim Jennison and High Income
Can any of the company-specific risk be diversified away by investing in both Pgim Jennison and High Income 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 High Income 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 High Income Fund, you can compare the effects of market volatilities on Pgim Jennison and High Income 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 High Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pgim Jennison and High Income.
Diversification Opportunities for Pgim Jennison and High Income
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pgim and High is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Pgim Jennison Technology and High Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Income Fund 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 High Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Income Fund has no effect on the direction of Pgim Jennison i.e., Pgim Jennison and High Income go up and down completely randomly.
Pair Corralation between Pgim Jennison and High Income
Assuming the 90 days horizon Pgim Jennison Technology is expected to generate 6.16 times more return on investment than High Income. However, Pgim Jennison is 6.16 times more volatile than High Income Fund. It trades about 0.11 of its potential returns per unit of risk. High Income Fund is currently generating about 0.15 per unit of risk. If you would invest 1,180 in Pgim Jennison Technology on September 12, 2024 and sell it today you would earn a total of 1,469 from holding Pgim Jennison Technology or generate 124.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pgim Jennison Technology vs. High Income Fund
Performance |
| Timeline |
| Pgim Jennison Technology |
| High Income Fund |
Pgim Jennison and High Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pgim Jennison and High Income
The main advantage of trading using opposite Pgim Jennison and High Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pgim Jennison position performs unexpectedly, High Income 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 High Income will offset losses from the drop in High Income's long position.| Pgim Jennison vs. California High Yield Municipal | Pgim Jennison vs. Gamco Global Telecommunications | Pgim Jennison vs. Pace Municipal Fixed | Pgim Jennison vs. Dws Government Money |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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