Correlation Between Amazon and Prudential Jennison
Can any of the company-specific risk be diversified away by investing in both Amazon and Prudential Jennison 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 Amazon and Prudential Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and Prudential Jennison Mid Cap, you can compare the effects of market volatilities on Amazon and Prudential Jennison 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 Amazon with a short position of Prudential Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Prudential Jennison.
Diversification Opportunities for Amazon and Prudential Jennison
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Amazon and Prudential is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Prudential Jennison Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Jennison Mid and Amazon 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 Amazon Inc are associated (or correlated) with Prudential Jennison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Jennison Mid has no effect on the direction of Amazon i.e., Amazon and Prudential Jennison go up and down completely randomly.
Pair Corralation between Amazon and Prudential Jennison
Given the investment horizon of 90 days Amazon Inc is expected to under-perform the Prudential Jennison. In addition to that, Amazon is 2.33 times more volatile than Prudential Jennison Mid Cap. It trades about -0.05 of its total potential returns per unit of risk. Prudential Jennison Mid Cap is currently generating about 0.05 per unit of volatility. If you would invest 1,210 in Prudential Jennison Mid Cap on July 20, 2025 and sell it today you would earn a total of 27.00 from holding Prudential Jennison Mid Cap or generate 2.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amazon Inc vs. Prudential Jennison Mid Cap
Performance |
| Timeline |
| Amazon Inc |
| Prudential Jennison Mid |
Amazon and Prudential Jennison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and Prudential Jennison
The main advantage of trading using opposite Amazon and Prudential Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Prudential Jennison 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 Prudential Jennison will offset losses from the drop in Prudential Jennison's long position.| Amazon vs. Alibaba Group Holding | Amazon vs. ATRenew Inc DRC | Amazon vs. Liquidity Services | Amazon vs. GameStop Corp |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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