Correlation Between Prudential Jennison and Lkcm Aquinas
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Lkcm Aquinas 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 Lkcm Aquinas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Jennison International and Lkcm Aquinas Catholic, you can compare the effects of market volatilities on Prudential Jennison and Lkcm Aquinas 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 Lkcm Aquinas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Lkcm Aquinas.
Diversification Opportunities for Prudential Jennison and Lkcm Aquinas
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Prudential and Lkcm is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Internatio and Lkcm Aquinas Catholic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lkcm Aquinas Catholic 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 International are associated (or correlated) with Lkcm Aquinas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lkcm Aquinas Catholic has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Lkcm Aquinas go up and down completely randomly.
Pair Corralation between Prudential Jennison and Lkcm Aquinas
Assuming the 90 days horizon Prudential Jennison International is expected to under-perform the Lkcm Aquinas. In addition to that, Prudential Jennison is 1.14 times more volatile than Lkcm Aquinas Catholic. It trades about -0.15 of its total potential returns per unit of risk. Lkcm Aquinas Catholic is currently generating about 0.12 per unit of volatility. If you would invest 1,920 in Lkcm Aquinas Catholic on August 30, 2024 and sell it today you would earn a total of 69.00 from holding Lkcm Aquinas Catholic or generate 3.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Jennison Internatio vs. Lkcm Aquinas Catholic
Performance |
| Timeline |
| Prudential Jennison |
| Lkcm Aquinas Catholic |
Prudential Jennison and Lkcm Aquinas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Lkcm Aquinas
The main advantage of trading using opposite Prudential Jennison and Lkcm Aquinas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Lkcm Aquinas 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 Lkcm Aquinas will offset losses from the drop in Lkcm Aquinas' long position.| Prudential Jennison vs. Europacific Growth Fund | Prudential Jennison vs. Europacific Growth Fund | Prudential Jennison vs. Europacific Growth Fund | Prudential Jennison vs. Europacific Growth Fund |
| Lkcm Aquinas vs. Lkcm Small Cap | Lkcm Aquinas vs. Prudential Jennison International | Lkcm Aquinas vs. Fidelity New Markets |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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