Correlation Between Aston/crosswind Small and Franklin High
Can any of the company-specific risk be diversified away by investing in both Aston/crosswind Small and Franklin High 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 Aston/crosswind Small and Franklin High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astoncrosswind Small Cap and Franklin High Yield, you can compare the effects of market volatilities on Aston/crosswind Small and Franklin High 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 Aston/crosswind Small with a short position of Franklin High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aston/crosswind Small and Franklin High.
Diversification Opportunities for Aston/crosswind Small and Franklin High
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aston/crosswind and Franklin is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Astoncrosswind Small Cap and Franklin High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin High Yield and Aston/crosswind Small 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 Astoncrosswind Small Cap are associated (or correlated) with Franklin High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin High Yield has no effect on the direction of Aston/crosswind Small i.e., Aston/crosswind Small and Franklin High go up and down completely randomly.
Pair Corralation between Aston/crosswind Small and Franklin High
Assuming the 90 days horizon Astoncrosswind Small Cap is expected to generate 3.81 times more return on investment than Franklin High. However, Aston/crosswind Small is 3.81 times more volatile than Franklin High Yield. It trades about 0.15 of its potential returns per unit of risk. Franklin High Yield is currently generating about 0.05 per unit of risk. If you would invest 1,747 in Astoncrosswind Small Cap on November 7, 2024 and sell it today you would earn a total of 50.00 from holding Astoncrosswind Small Cap or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Astoncrosswind Small Cap vs. Franklin High Yield
Performance |
| Timeline |
| Astoncrosswind Small Cap |
| Franklin High Yield |
Aston/crosswind Small and Franklin High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aston/crosswind Small and Franklin High
The main advantage of trading using opposite Aston/crosswind Small and Franklin High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aston/crosswind Small position performs unexpectedly, Franklin High 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 Franklin High will offset losses from the drop in Franklin High's long position.| Aston/crosswind Small vs. Baron Real Estate | Aston/crosswind Small vs. Eventide Gilead Fund | Aston/crosswind Small vs. Buffalo Emerging Opportunities | Aston/crosswind Small vs. Large Cap Growth |
| Franklin High vs. Payden Government Fund | Franklin High vs. Hsbc Government Money | Franklin High vs. Franklin Adjustable Government | Franklin High vs. Davis Government Bond |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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