Correlation Between PGIM Short and CBH
Can any of the company-specific risk be diversified away by investing in both PGIM Short and CBH 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 PGIM Short and CBH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PGIM Short Duration and CBH, you can compare the effects of market volatilities on PGIM Short and CBH 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 PGIM Short with a short position of CBH. Check out your portfolio center. Please also check ongoing floating volatility patterns of PGIM Short and CBH.
Diversification Opportunities for PGIM Short and CBH
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between PGIM and CBH is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding PGIM Short Duration and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH and PGIM Short 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 PGIM Short Duration are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of PGIM Short i.e., PGIM Short and CBH go up and down completely randomly.
Pair Corralation between PGIM Short and CBH
If you would invest 1,652 in PGIM Short Duration on August 31, 2024 and sell it today you would earn a total of 1.00 from holding PGIM Short Duration or generate 0.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.35% |
| Values | Daily Returns |
PGIM Short Duration vs. CBH
Performance |
| Timeline |
| PGIM Short Duration |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PGIM Short and CBH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PGIM Short and CBH
The main advantage of trading using opposite PGIM Short and CBH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PGIM Short position performs unexpectedly, CBH 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 CBH will offset losses from the drop in CBH's long position.| PGIM Short vs. John Hancock Income | PGIM Short vs. MFS High Income | PGIM Short vs. MFS Investment Grade | PGIM Short vs. Blackrock Muniholdings Closed |
| CBH vs. Eaton Vance National | CBH vs. Invesco High Income | CBH vs. Blackrock Muniholdings Ny | CBH vs. Nuveen California Select |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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