Correlation Between Technology Munications and Pgim Jennison

Can any of the company-specific risk be diversified away by investing in both Technology Munications 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 Technology Munications and Pgim Jennison into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Technology Munications Portfolio and Pgim Jennison Technology, you can compare the effects of market volatilities on Technology Munications 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 Technology Munications with a short position of Pgim Jennison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Technology Munications and Pgim Jennison.

Diversification Opportunities for Technology Munications and Pgim Jennison

0.99

Correlation Coefficient

Technology Munications  Pgim Jennison

No risk reduction

The 3 months correlation between Technology and Pgim is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Technology Munications Portfol and Pgim Jennison Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Jennison Technology and Technology Munications 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 Technology Munications Portfolio 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 Technology has no effect on the direction of Technology Munications i.e., Technology Munications and Pgim Jennison go up and down completely randomly.

Pair Corralation between Technology Munications and Pgim Jennison

Assuming the 90 days horizon Technology Munications Portfolio is expected to generate 0.88 times more return on investment than Pgim Jennison. However, Technology Munications Portfolio is 1.14 times less risky than Pgim Jennison. It trades about 0.21 of its potential returns per unit of risk. Pgim Jennison Technology is currently generating about 0.16 per unit of risk. If you would invest  2,633  in Technology Munications Portfolio on May 19, 2025 and sell it today you would earn a total of  313.00  from holding Technology Munications Portfolio or generate 11.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Technology Munications Portfol  vs.  Pgim Jennison Technology

Technology Munications

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Technology Munications Portfolio are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Technology Munications may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pgim Jennison Technology

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pgim Jennison Technology are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Pgim Jennison may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Technology Munications and Pgim Jennison

The main advantage of trading using opposite Technology Munications and Pgim Jennison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Technology Munications 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.

The idea behind Technology Munications Portfolio and Pgim Jennison Technology 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.

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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.