Correlation Between AMTD IDEA and Franklin Resources
Can any of the company-specific risk be diversified away by investing in both AMTD IDEA and Franklin Resources 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 AMTD IDEA and Franklin Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMTD IDEA Group and Franklin Resources, you can compare the effects of market volatilities on AMTD IDEA and Franklin Resources 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 AMTD IDEA with a short position of Franklin Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMTD IDEA and Franklin Resources.
Diversification Opportunities for AMTD IDEA and Franklin Resources
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AMTD and Franklin is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding AMTD IDEA Group and Franklin Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Resources and AMTD IDEA 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 AMTD IDEA Group are associated (or correlated) with Franklin Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Resources has no effect on the direction of AMTD IDEA i.e., AMTD IDEA and Franklin Resources go up and down completely randomly.
Pair Corralation between AMTD IDEA and Franklin Resources
Given the investment horizon of 90 days AMTD IDEA Group is expected to under-perform the Franklin Resources. In addition to that, AMTD IDEA is 1.75 times more volatile than Franklin Resources. It trades about -0.09 of its total potential returns per unit of risk. Franklin Resources is currently generating about 0.0 per unit of volatility. If you would invest 2,453 in Franklin Resources on August 29, 2024 and sell it today you would lose (185.00) from holding Franklin Resources or give up 7.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMTD IDEA Group vs. Franklin Resources
Performance |
| Timeline |
| AMTD IDEA Group |
| Franklin Resources |
AMTD IDEA and Franklin Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMTD IDEA and Franklin Resources
The main advantage of trading using opposite AMTD IDEA and Franklin Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMTD IDEA position performs unexpectedly, Franklin Resources 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 Resources will offset losses from the drop in Franklin Resources' long position.| AMTD IDEA vs. Franklin Resources | AMTD IDEA vs. Janus Henderson Group | AMTD IDEA vs. State Street Corp | AMTD IDEA vs. Northern Trust |
| Franklin Resources vs. TPG Inc | Franklin Resources vs. Carlyle Secured Lending | Franklin Resources vs. Brookfield Corp |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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