Correlation Between Prudential Jennison and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Emerging Markets 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 Emerging Markets 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 Emerging Markets Growth, you can compare the effects of market volatilities on Prudential Jennison and Emerging Markets 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 Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Emerging Markets.
Diversification Opportunities for Prudential Jennison and Emerging Markets
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Prudential and Emerging is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Internatio and Emerging Markets Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets 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 International are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets Growth has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Emerging Markets go up and down completely randomly.
Pair Corralation between Prudential Jennison and Emerging Markets
Assuming the 90 days horizon Prudential Jennison is expected to generate 6.37 times less return on investment than Emerging Markets. In addition to that, Prudential Jennison is 1.31 times more volatile than Emerging Markets Growth. It trades about 0.0 of its total potential returns per unit of risk. Emerging Markets Growth is currently generating about 0.03 per unit of volatility. If you would invest 666.00 in Emerging Markets Growth on August 31, 2024 and sell it today you would earn a total of 22.00 from holding Emerging Markets Growth or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Jennison Internatio vs. Emerging Markets Growth
Performance |
| Timeline |
| Prudential Jennison |
| Emerging Markets Growth |
Prudential Jennison and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Emerging Markets
The main advantage of trading using opposite Prudential Jennison and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Prudential Jennison vs. Europacific Growth Fund | Prudential Jennison vs. Europacific Growth Fund | Prudential Jennison vs. HUMANA INC | Prudential Jennison vs. Aquagold International |
| Emerging Markets vs. Quantitative Longshort Equity | Emerging Markets vs. Sterling Capital Short | Emerging Markets vs. Federated Ultrashort Bond | Emerging Markets vs. Franklin Federal Limited Term |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |