Correlation Between Prudential Jennison and Pgim Securitized
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Pgim Securitized 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 Pgim Securitized 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 Pgim Securitized Credit, you can compare the effects of market volatilities on Prudential Jennison and Pgim Securitized 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 Pgim Securitized. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Pgim Securitized.
Diversification Opportunities for Prudential Jennison and Pgim Securitized
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Prudential and Pgim is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Growth and Pgim Securitized Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Securitized Credit 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 Pgim Securitized. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pgim Securitized Credit has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Pgim Securitized go up and down completely randomly.
Pair Corralation between Prudential Jennison and Pgim Securitized
Assuming the 90 days horizon Prudential Jennison Growth is expected to generate 8.1 times more return on investment than Pgim Securitized. However, Prudential Jennison is 8.1 times more volatile than Pgim Securitized Credit. It trades about 0.12 of its potential returns per unit of risk. Pgim Securitized Credit is currently generating about 0.24 per unit of risk. If you would invest 7,124 in Prudential Jennison Growth on August 31, 2024 and sell it today you would earn a total of 196.00 from holding Prudential Jennison Growth or generate 2.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Jennison Growth vs. Pgim Securitized Credit
Performance |
| Timeline |
| Prudential Jennison |
| Pgim Securitized Credit |
Prudential Jennison and Pgim Securitized Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Pgim Securitized
The main advantage of trading using opposite Prudential Jennison and Pgim Securitized positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Pgim Securitized 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 Pgim Securitized will offset losses from the drop in Pgim Securitized's long position.| Prudential Jennison vs. Transamerica Funds | Prudential Jennison vs. Federated Ohio Municipal | Prudential Jennison vs. Franklin High Yield | Prudential Jennison vs. Oklahoma Municipal Fund |
| Pgim Securitized vs. T Rowe Price | Pgim Securitized vs. Goldman Sachs Large | Pgim Securitized vs. T Rowe Price | Pgim Securitized vs. Legg Mason Bw |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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