Correlation Between Prudential Qma and Quantitative

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

By analyzing existing cross correlation between Prudential Qma Small Cap and Quantitative U S, you can compare the effects of market volatilities on Prudential Qma and Quantitative 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 Qma with a short position of Quantitative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Qma and Quantitative.

Diversification Opportunities for Prudential Qma and Quantitative

0.92

Correlation Coefficient

Prudential Qma  Quantitative

Almost no diversification

The 3 months correlation between Prudential and Quantitative is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Qma Small Cap and Quantitative U S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantitative U S and Prudential Qma 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 Qma Small Cap are associated (or correlated) with Quantitative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantitative U S has no effect on the direction of Prudential Qma i.e., Prudential Qma and Quantitative go up and down completely randomly.

Pair Corralation between Prudential Qma and Quantitative

Assuming the 90 days horizon Prudential Qma Small Cap is expected to generate 1.62 times more return on investment than Quantitative. However, Prudential Qma is 1.62 times more volatile than Quantitative U S. It trades about 0.09 of its potential returns per unit of risk. Quantitative U S is currently generating about 0.12 per unit of risk. If you would invest  1,715  in Prudential Qma Small Cap on July 10, 2025 and sell it today you would earn a total of  106.00  from holding Prudential Qma Small Cap or generate 6.18% return on investment over 90 days.

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

Prudential Qma Small Cap  vs.  Quantitative U S

Prudential Qma Small

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Prudential Qma Small Cap are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Prudential Qma may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Quantitative U S

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Quantitative U S are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Quantitative is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Prudential Qma and Quantitative

The main advantage of trading using opposite Prudential Qma and Quantitative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Qma position performs unexpectedly, Quantitative 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 Quantitative will offset losses from the drop in Quantitative's long position.

The idea behind Prudential Qma Small Cap and Quantitative U S 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.