Correlation Between Pgim Jennison and Eafe Pure
Can any of the company-specific risk be diversified away by investing in both Pgim Jennison and Eafe Pure 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 Jennison and Eafe Pure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pgim Jennison Diversified and The Eafe Pure, you can compare the effects of market volatilities on Pgim Jennison and Eafe Pure 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 Jennison with a short position of Eafe Pure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pgim Jennison and Eafe Pure.
Diversification Opportunities for Pgim Jennison and Eafe Pure
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pgim and Eafe is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Pgim Jennison Diversified and The Eafe Pure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eafe Pure and Pgim 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 Pgim Jennison Diversified are associated (or correlated) with Eafe Pure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eafe Pure has no effect on the direction of Pgim Jennison i.e., Pgim Jennison and Eafe Pure go up and down completely randomly.
Pair Corralation between Pgim Jennison and Eafe Pure
Assuming the 90 days horizon Pgim Jennison Diversified is expected to generate 0.83 times more return on investment than Eafe Pure. However, Pgim Jennison Diversified is 1.21 times less risky than Eafe Pure. It trades about 0.32 of its potential returns per unit of risk. The Eafe Pure is currently generating about -0.14 per unit of risk. If you would invest 2,043 in Pgim Jennison Diversified on September 5, 2024 and sell it today you would earn a total of 141.00 from holding Pgim Jennison Diversified or generate 6.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Pgim Jennison Diversified vs. The Eafe Pure
Performance |
| Timeline |
| Pgim Jennison Diversified |
| Eafe Pure |
Pgim Jennison and Eafe Pure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pgim Jennison and Eafe Pure
The main advantage of trading using opposite Pgim Jennison and Eafe Pure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pgim Jennison position performs unexpectedly, Eafe Pure 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 Eafe Pure will offset losses from the drop in Eafe Pure's long position.| Pgim Jennison vs. Prudential Jennison International | Pgim Jennison vs. Prudential Jennison International | Pgim Jennison vs. Pgim Jennison International | Pgim Jennison vs. Pgim Jennison International |
| Eafe Pure vs. The Long Term | Eafe Pure vs. Baillie Gifford International | Eafe Pure vs. Baillie Gifford China | Eafe Pure vs. The Global Alpha |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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