Correlation Between Prudential Real and Pgim Jennison
Can any of the company-specific risk be diversified away by investing in both Prudential Real and Pgim 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 Prudential Real and Pgim Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Real Estate and Pgim Jennison Diversified, you can compare the effects of market volatilities on Prudential Real and Pgim 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 Prudential Real with a short position of Pgim Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Real and Pgim Jennison.
Diversification Opportunities for Prudential Real and Pgim Jennison
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Prudential and Pgim is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Real Estate and Pgim Jennison Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Jennison Diversified and Prudential Real 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 Real Estate are associated (or correlated) with Pgim Jennison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pgim Jennison Diversified has no effect on the direction of Prudential Real i.e., Prudential Real and Pgim Jennison go up and down completely randomly.
Pair Corralation between Prudential Real and Pgim Jennison
Assuming the 90 days horizon Prudential Real is expected to generate 1.94 times less return on investment than Pgim Jennison. But when comparing it to its historical volatility, Prudential Real Estate is 1.2 times less risky than Pgim Jennison. It trades about 0.04 of its potential returns per unit of risk. Pgim Jennison Diversified is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,326 in Pgim Jennison Diversified on March 21, 2025 and sell it today you would earn a total of 650.00 from holding Pgim Jennison Diversified or generate 49.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prudential Real Estate vs. Pgim Jennison Diversified
Performance |
| Timeline |
| Prudential Real Estate |
| Pgim Jennison Diversified |
Prudential Real and Pgim Jennison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Real and Pgim Jennison
The main advantage of trading using opposite Prudential Real and Pgim Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Real position performs unexpectedly, Pgim 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 Pgim Jennison will offset losses from the drop in Pgim Jennison's long position.| Prudential Real vs. Blackrock High Income | Prudential Real vs. Needham Aggressive Growth | Prudential Real vs. Artisan High Income | Prudential Real vs. Morningstar Aggressive Growth |
| Pgim Jennison vs. Fulcrum Diversified Absolute | Pgim Jennison vs. Aqr Diversified Arbitrage | Pgim Jennison vs. Delaware Limited Term Diversified | Pgim Jennison vs. Tiaa Cref Lifestyle Conservative |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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