Correlation Between Prudential Jennison and Mid Cap
Can any of the company-specific risk be diversified away by investing in both Prudential Jennison and Mid Cap 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 Mid Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Jennison Mid Cap and Mid Cap Value, you can compare the effects of market volatilities on Prudential Jennison and Mid Cap 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 Mid Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Jennison and Mid Cap.
Diversification Opportunities for Prudential Jennison and Mid Cap
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Prudential and Mid is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Jennison Mid Cap and Mid Cap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mid Cap Value 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 Mid Cap are associated (or correlated) with Mid Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mid Cap Value has no effect on the direction of Prudential Jennison i.e., Prudential Jennison and Mid Cap go up and down completely randomly.
Pair Corralation between Prudential Jennison and Mid Cap
Assuming the 90 days horizon Prudential Jennison is expected to generate 1.63 times less return on investment than Mid Cap. In addition to that, Prudential Jennison is 1.01 times more volatile than Mid Cap Value. It trades about 0.08 of its total potential returns per unit of risk. Mid Cap Value is currently generating about 0.13 per unit of volatility. If you would invest 1,554 in Mid Cap Value on June 6, 2025 and sell it today you would earn a total of 95.00 from holding Mid Cap Value or generate 6.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Jennison Mid Cap vs. Mid Cap Value
Performance |
| Timeline |
| Prudential Jennison Mid |
| Mid Cap Value |
Prudential Jennison and Mid Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Jennison and Mid Cap
The main advantage of trading using opposite Prudential Jennison and Mid Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Jennison position performs unexpectedly, Mid Cap 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 Mid Cap will offset losses from the drop in Mid Cap's long position.| Prudential Jennison vs. Franklin Emerging Market | Prudential Jennison vs. Payden Emerging Markets | Prudential Jennison vs. Ab Select Longshort | Prudential Jennison vs. Nuveen Equity Longshort |
| Mid Cap vs. Value Fund R | Mid Cap vs. Prudential Jennison Mid Cap | Mid Cap vs. Eaton Vance Atlanta | Mid Cap vs. Templeton Global Bond |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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