Correlation Between Pgim Jennison and Federated Emerging
Can any of the company-specific risk be diversified away by investing in both Pgim Jennison and Federated Emerging 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 Federated Emerging 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 Federated Emerging Market, you can compare the effects of market volatilities on Pgim Jennison and Federated Emerging 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 Federated Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pgim Jennison and Federated Emerging.
Diversification Opportunities for Pgim Jennison and Federated Emerging
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pgim and Federated is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Pgim Jennison Diversified and Federated Emerging Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Emerging Market 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 Federated Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Emerging Market has no effect on the direction of Pgim Jennison i.e., Pgim Jennison and Federated Emerging go up and down completely randomly.
Pair Corralation between Pgim Jennison and Federated Emerging
Assuming the 90 days horizon Pgim Jennison Diversified is expected to generate 3.51 times more return on investment than Federated Emerging. However, Pgim Jennison is 3.51 times more volatile than Federated Emerging Market. It trades about 0.11 of its potential returns per unit of risk. Federated Emerging Market is currently generating about 0.13 per unit of risk. If you would invest 1,593 in Pgim Jennison Diversified on September 4, 2024 and sell it today you would earn a total of 578.00 from holding Pgim Jennison Diversified or generate 36.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Pgim Jennison Diversified vs. Federated Emerging Market
Performance |
| Timeline |
| Pgim Jennison Diversified |
| Federated Emerging Market |
Pgim Jennison and Federated Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pgim Jennison and Federated Emerging
The main advantage of trading using opposite Pgim Jennison and Federated Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pgim Jennison position performs unexpectedly, Federated Emerging 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 Federated Emerging will offset losses from the drop in Federated Emerging'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 |
| Federated Emerging vs. Federated Emerging Market | Federated Emerging vs. Federated Mdt All | Federated Emerging vs. Federated Mdt Balanced | Federated Emerging vs. Federated Global Allocation |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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