Correlation Between Anfield Universal and Franklin Liberty
Can any of the company-specific risk be diversified away by investing in both Anfield Universal and Franklin Liberty 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 Anfield Universal and Franklin Liberty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anfield Universal Fixed and Franklin Liberty Systematic, you can compare the effects of market volatilities on Anfield Universal and Franklin Liberty 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 Anfield Universal with a short position of Franklin Liberty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anfield Universal and Franklin Liberty.
Diversification Opportunities for Anfield Universal and Franklin Liberty
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anfield and Franklin is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Anfield Universal Fixed and Franklin Liberty Systematic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Liberty Sys and Anfield Universal 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 Anfield Universal Fixed are associated (or correlated) with Franklin Liberty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Liberty Sys has no effect on the direction of Anfield Universal i.e., Anfield Universal and Franklin Liberty go up and down completely randomly.
Pair Corralation between Anfield Universal and Franklin Liberty
Given the investment horizon of 90 days Anfield Universal is expected to generate 1.18 times less return on investment than Franklin Liberty. But when comparing it to its historical volatility, Anfield Universal Fixed is 3.7 times less risky than Franklin Liberty. It trades about 0.13 of its potential returns per unit of risk. Franklin Liberty Systematic is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,079 in Franklin Liberty Systematic on September 1, 2024 and sell it today you would earn a total of 334.00 from holding Franklin Liberty Systematic or generate 16.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anfield Universal Fixed vs. Franklin Liberty Systematic
Performance |
| Timeline |
| Anfield Universal Fixed |
| Franklin Liberty Sys |
Anfield Universal and Franklin Liberty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anfield Universal and Franklin Liberty
The main advantage of trading using opposite Anfield Universal and Franklin Liberty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anfield Universal position performs unexpectedly, Franklin Liberty 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 Liberty will offset losses from the drop in Franklin Liberty's long position.| Anfield Universal vs. FlexShares Core Select | Anfield Universal vs. Anfield Equity Sector | Anfield Universal vs. WisdomTree Interest Rate |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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