Correlation Between Jhancock Global and Prudential Qma
Can any of the company-specific risk be diversified away by investing in both Jhancock Global and Prudential Qma 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 Jhancock Global and Prudential Qma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jhancock Global Equity and Prudential Qma Small Cap, you can compare the effects of market volatilities on Jhancock Global and Prudential Qma 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 Jhancock Global with a short position of Prudential Qma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Global and Prudential Qma.
Diversification Opportunities for Jhancock Global and Prudential Qma
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jhancock and Prudential is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Global Equity and Prudential Qma Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Qma Small and Jhancock Global 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 Jhancock Global Equity are associated (or correlated) with Prudential Qma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Qma Small has no effect on the direction of Jhancock Global i.e., Jhancock Global and Prudential Qma go up and down completely randomly.
Pair Corralation between Jhancock Global and Prudential Qma
Assuming the 90 days horizon Jhancock Global Equity is expected to generate 0.58 times more return on investment than Prudential Qma. However, Jhancock Global Equity is 1.74 times less risky than Prudential Qma. It trades about 0.06 of its potential returns per unit of risk. Prudential Qma Small Cap is currently generating about 0.02 per unit of risk. If you would invest 1,026 in Jhancock Global Equity on April 19, 2025 and sell it today you would earn a total of 245.00 from holding Jhancock Global Equity or generate 23.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jhancock Global Equity vs. Prudential Qma Small Cap
Performance |
| Timeline |
| Jhancock Global Equity |
| Prudential Qma Small |
Jhancock Global and Prudential Qma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jhancock Global and Prudential Qma
The main advantage of trading using opposite Jhancock Global and Prudential Qma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Global position performs unexpectedly, Prudential Qma 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 Qma will offset losses from the drop in Prudential Qma's long position.| Jhancock Global vs. T Rowe Price | Jhancock Global vs. Multimedia Portfolio Multimedia | Jhancock Global vs. L Mason Qs | Jhancock Global vs. Qs Growth Fund |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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