Correlation Between General American and Prudential Total
Can any of the company-specific risk be diversified away by investing in both General American and Prudential Total 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 General American and Prudential Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General American Investors and Prudential Total Return, you can compare the effects of market volatilities on General American and Prudential Total 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 General American with a short position of Prudential Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of General American and Prudential Total.
Diversification Opportunities for General American and Prudential Total
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between General and Prudential is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General American Investors and Prudential Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Total Return and General American 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 General American Investors are associated (or correlated) with Prudential Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Total Return has no effect on the direction of General American i.e., General American and Prudential Total go up and down completely randomly.
Pair Corralation between General American and Prudential Total
If you would invest 4,772 in General American Investors on January 19, 2024 and sell it today you would earn a total of 781.00 from holding General American Investors or generate 16.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
General American Investors vs. Prudential Total Return
Performance |
| Timeline |
| General American Inv |
| Prudential Total Return |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
General American and Prudential Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General American and Prudential Total
The main advantage of trading using opposite General American and Prudential Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General American position performs unexpectedly, Prudential Total 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 Total will offset losses from the drop in Prudential Total's long position.| General American vs. Tekla Healthcare Investors | General American vs. Tekla Life Sciences | General American vs. Flaherty and Crumrine | General American vs. Cohen And Steers |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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