Correlation Between ATT and Prudential Jennison
Can any of the company-specific risk be diversified away by investing in both ATT 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 ATT and Prudential Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and Prudential Jennison Mid Cap, you can compare the effects of market volatilities on ATT 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 ATT with a short position of Prudential Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Prudential Jennison.
Diversification Opportunities for ATT and Prudential Jennison
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ATT and Prudential is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding ATT 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 ATT 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 ATT 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 ATT i.e., ATT and Prudential Jennison go up and down completely randomly.
Pair Corralation between ATT and Prudential Jennison
Taking into account the 90-day investment horizon ATT Inc is expected to under-perform the Prudential Jennison. In addition to that, ATT is 1.45 times more volatile than Prudential Jennison Mid Cap. It trades about -0.03 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 |
ATT Inc vs. Prudential Jennison Mid Cap
Performance |
| Timeline |
| ATT Inc |
| Prudential Jennison Mid |
ATT and Prudential Jennison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and Prudential Jennison
The main advantage of trading using opposite ATT and Prudential Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT 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.The idea behind ATT Inc and Prudential Jennison Mid Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Prudential Jennison vs. The National Tax Free | Prudential Jennison vs. Blrc Sgy Mnp | Prudential Jennison vs. Auxier Focus Fund | Prudential Jennison vs. Intermediate Term Bond Fund |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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