Correlation Between Ab Pennsylvania and Franklin FTSE
Can any of the company-specific risk be diversified away by investing in both Ab Pennsylvania and Franklin FTSE 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 Pennsylvania and Franklin FTSE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Pennsylvania Portfolio and Franklin FTSE South, you can compare the effects of market volatilities on Ab Pennsylvania and Franklin FTSE 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 Pennsylvania with a short position of Franklin FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Pennsylvania and Franklin FTSE.
Diversification Opportunities for Ab Pennsylvania and Franklin FTSE
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between APAAX and Franklin is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Ab Pennsylvania Portfolio and Franklin FTSE South in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin FTSE South and Ab Pennsylvania 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 Pennsylvania Portfolio are associated (or correlated) with Franklin FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin FTSE South has no effect on the direction of Ab Pennsylvania i.e., Ab Pennsylvania and Franklin FTSE go up and down completely randomly.
Pair Corralation between Ab Pennsylvania and Franklin FTSE
Assuming the 90 days horizon Ab Pennsylvania Portfolio is expected to generate 0.18 times more return on investment than Franklin FTSE. However, Ab Pennsylvania Portfolio is 5.71 times less risky than Franklin FTSE. It trades about 0.19 of its potential returns per unit of risk. Franklin FTSE South is currently generating about -0.09 per unit of risk. If you would invest 974.00 in Ab Pennsylvania Portfolio on September 1, 2024 and sell it today you would earn a total of 10.00 from holding Ab Pennsylvania Portfolio or generate 1.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ab Pennsylvania Portfolio vs. Franklin FTSE South
Performance |
| Timeline |
| Ab Pennsylvania Portfolio |
| Franklin FTSE South |
Ab Pennsylvania and Franklin FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Pennsylvania and Franklin FTSE
The main advantage of trading using opposite Ab Pennsylvania and Franklin FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Pennsylvania position performs unexpectedly, Franklin FTSE 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 FTSE will offset losses from the drop in Franklin FTSE's long position.| Ab Pennsylvania vs. Ab Global E | Ab Pennsylvania vs. Ab Global E | Ab Pennsylvania vs. Ab Global E | Ab Pennsylvania vs. Ab Minnesota Portfolio |
| Franklin FTSE vs. HUMANA INC | Franklin FTSE vs. SCOR PK | Franklin FTSE vs. Aquagold International | Franklin FTSE vs. Ab Pennsylvania Portfolio |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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