Correlation Between Prudential Financial and Burlington Stores
Can any of the company-specific risk be diversified away by investing in both Prudential Financial and Burlington Stores 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 Financial and Burlington Stores into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Financial and Burlington Stores, you can compare the effects of market volatilities on Prudential Financial and Burlington Stores 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 Financial with a short position of Burlington Stores. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Financial and Burlington Stores.
Diversification Opportunities for Prudential Financial and Burlington Stores
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Prudential and Burlington is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Financial and Burlington Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burlington Stores and Prudential Financial 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 Financial are associated (or correlated) with Burlington Stores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burlington Stores has no effect on the direction of Prudential Financial i.e., Prudential Financial and Burlington Stores go up and down completely randomly.
Pair Corralation between Prudential Financial and Burlington Stores
Assuming the 90 days trading horizon Prudential Financial is expected to generate 32.85 times less return on investment than Burlington Stores. But when comparing it to its historical volatility, Prudential Financial is 32.86 times less risky than Burlington Stores. It trades about 0.22 of its potential returns per unit of risk. Burlington Stores is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 425,300 in Burlington Stores on August 28, 2024 and sell it today you would earn a total of 184,700 from holding Burlington Stores or generate 43.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Financial vs. Burlington Stores
Performance |
| Timeline |
| Prudential Financial |
| Burlington Stores |
Prudential Financial and Burlington Stores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Financial and Burlington Stores
The main advantage of trading using opposite Prudential Financial and Burlington Stores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Financial position performs unexpectedly, Burlington Stores 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 Burlington Stores will offset losses from the drop in Burlington Stores' long position.| Prudential Financial vs. Deutsche Bank Aktiengesellschaft | Prudential Financial vs. Micron Technology | Prudential Financial vs. The Bank of | Prudential Financial vs. FibraHotel |
| Burlington Stores vs. Cognizant Technology Solutions | Burlington Stores vs. United States Steel | Burlington Stores vs. Verizon Communications | Burlington Stores vs. Genworth Financial |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |