Correlation Between Prudential Jennison and Europacific Growth
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Europacific Growth 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 Europacific Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Jennison Growth and Europacific Growth Fund, you can compare the effects of market volatilities on Prudential Jennison and Europacific Growth 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 Europacific Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Europacific Growth.
Diversification Opportunities for Prudential Jennison and Europacific Growth
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Prudential and Europacific is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Growth and Europacific Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Europacific Growth 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 Growth are associated (or correlated) with Europacific Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Europacific Growth has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Europacific Growth go up and down completely randomly.
Pair Corralation between Prudential Jennison and Europacific Growth
Assuming the 90 days horizon Prudential Jennison Growth is expected to generate 1.47 times more return on investment than Europacific Growth. However, Prudential Jennison is 1.47 times more volatile than Europacific Growth Fund. It trades about 0.08 of its potential returns per unit of risk. Europacific Growth Fund is currently generating about 0.03 per unit of risk. If you would invest 4,699 in Prudential Jennison Growth on August 31, 2024 and sell it today you would earn a total of 1,952 from holding Prudential Jennison Growth or generate 41.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Jennison Growth vs. Europacific Growth Fund
Performance |
| Timeline |
| Prudential Jennison |
| Europacific Growth |
Prudential Jennison and Europacific Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Europacific Growth
The main advantage of trading using opposite Prudential Jennison and Europacific Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Europacific Growth 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 Europacific Growth will offset losses from the drop in Europacific Growth's long position.| Prudential Jennison vs. Europacific Growth Fund | Prudential Jennison vs. Washington Mutual Investors | Prudential Jennison vs. Capital World Growth | Prudential Jennison vs. HUMANA INC |
| Europacific Growth vs. Growth Fund Of | Europacific Growth vs. Vanguard Institutional Index | Europacific Growth vs. Vanguard Mid Cap Index | Europacific Growth vs. Washington Mutual Investors |
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
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |