Correlation Between Ab Global and Franklin High
Can any of the company-specific risk be diversified away by investing in both Ab Global 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 Ab Global and Franklin High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Bond and Franklin High Yield, you can compare the effects of market volatilities on Ab Global 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 Ab Global with a short position of Franklin High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Franklin High.
Diversification Opportunities for Ab Global and Franklin High
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ANAGX and Franklin is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Bond 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 Ab Global 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 Ab Global Bond 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 Ab Global i.e., Ab Global and Franklin High go up and down completely randomly.
Pair Corralation between Ab Global and Franklin High
Assuming the 90 days horizon Ab Global Bond is expected to generate 1.05 times more return on investment than Franklin High. However, Ab Global is 1.05 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 0.0 per unit of risk. If you would invest 685.00 in Ab Global Bond on November 6, 2024 and sell it today you would earn a total of 5.00 from holding Ab Global Bond or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Global Bond vs. Franklin High Yield
Performance |
| Timeline |
| Ab Global Bond |
| Franklin High Yield |
Ab Global and Franklin High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and Franklin High
The main advantage of trading using opposite Ab Global and Franklin High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global 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.| Ab Global vs. Blackrock Short Obligations | Ab Global vs. Fidelity Flex Servative | Ab Global vs. Old Westbury Short Term | Ab Global vs. Leader Short Term Bond |
| Franklin High vs. Rbc Small Cap | Franklin High vs. Legg Mason Partners | Franklin High vs. Needham Small Cap | Franklin High vs. Artisan Small Cap |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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