Correlation Between PGIM Ultra and Janus Henderson

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

By analyzing existing cross correlation between PGIM Ultra Short and Janus Henderson Short, you can compare the effects of market volatilities on PGIM Ultra and Janus Henderson 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 PGIM Ultra with a short position of Janus Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of PGIM Ultra and Janus Henderson.

Diversification Opportunities for PGIM Ultra and Janus Henderson

0.99

Correlation Coefficient

PGIM Ultra  Janus Henderson

No risk reduction

The 3 months correlation between PGIM and Janus is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding PGIM Ultra Short and Janus Henderson Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Henderson Short and PGIM Ultra 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 PGIM Ultra Short are associated (or correlated) with Janus Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Henderson Short has no effect on the direction of PGIM Ultra i.e., PGIM Ultra and Janus Henderson go up and down completely randomly.

Pair Corralation between PGIM Ultra and Janus Henderson

Given the investment horizon of 90 days PGIM Ultra is expected to generate 1.4 times less return on investment than Janus Henderson. But when comparing it to its historical volatility, PGIM Ultra Short is 2.61 times less risky than Janus Henderson. It trades about 0.92 of its potential returns per unit of risk. Janus Henderson Short is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest  4,821  in Janus Henderson Short on March 19, 2024 and sell it today you would earn a total of  26.00  from holding Janus Henderson Short or generate 0.54% return on investment over 90 days.

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

PGIM Ultra Short  vs.  Janus Henderson Short

PGIM Ultra Short

Risk-Adjusted Performance

61 of 100

Market Crasher

Compared to the overall equity markets, risk-adjusted returns on investments in PGIM Ultra Short are ranked lower than 61 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable essential indicators, PGIM Ultra is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Janus Henderson Short

Risk-Adjusted Performance

29 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Janus Henderson Short are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong essential indicators, Janus Henderson is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with PGIM Ultra and Janus Henderson

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

The idea behind PGIM Ultra Short and Janus Henderson Short 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.