Correlation Between Prudential Jennison and Jacob Small
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Jacob Small 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 Jacob Small 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 Jacob Small Cap, you can compare the effects of market volatilities on Prudential Jennison and Jacob Small 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 Jacob Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Jacob Small.
Diversification Opportunities for Prudential Jennison and Jacob Small
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Prudential and Jacob is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Internatio and Jacob Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacob Small Cap 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 Jacob Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacob Small Cap has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Jacob Small go up and down completely randomly.
Pair Corralation between Prudential Jennison and Jacob Small
Assuming the 90 days horizon Prudential Jennison is expected to generate 38.11 times less return on investment than Jacob Small. But when comparing it to its historical volatility, Prudential Jennison International is 1.85 times less risky than Jacob Small. It trades about 0.0 of its potential returns per unit of risk. Jacob Small Cap is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,766 in Jacob Small Cap on September 1, 2024 and sell it today you would earn a total of 377.00 from holding Jacob Small Cap or generate 21.35% 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. Jacob Small Cap
Performance |
| Timeline |
| Prudential Jennison |
| Jacob Small Cap |
Prudential Jennison and Jacob Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Jacob Small
The main advantage of trading using opposite Prudential Jennison and Jacob Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Jacob Small 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 Jacob Small will offset losses from the drop in Jacob Small's long position.| Prudential Jennison vs. Pgim Jennison International | Prudential Jennison vs. Prudential Short Duration | Prudential Jennison vs. Prudential Emerging Markets | Prudential Jennison vs. Prudential Floating Rate |
| Jacob Small vs. Jacob Micro Cap | Jacob Small vs. Jacob Internet Fund | Jacob Small vs. Jacob Forward ETF | Jacob Small vs. Oberweis Small Cap Opportunities |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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