Correlation Between Artisan High and Franklin Founding
Can any of the company-specific risk be diversified away by investing in both Artisan High and Franklin Founding 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 Artisan High and Franklin Founding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artisan High Income and Franklin Founding Funds, you can compare the effects of market volatilities on Artisan High and Franklin Founding 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 Artisan High with a short position of Franklin Founding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan High and Franklin Founding.
Diversification Opportunities for Artisan High and Franklin Founding
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Artisan and Franklin is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Artisan High Income and Franklin Founding Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Founding Funds and Artisan High 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 Artisan High Income are associated (or correlated) with Franklin Founding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Founding Funds has no effect on the direction of Artisan High i.e., Artisan High and Franklin Founding go up and down completely randomly.
Pair Corralation between Artisan High and Franklin Founding
Assuming the 90 days horizon Artisan High is expected to generate 1.69 times less return on investment than Franklin Founding. But when comparing it to its historical volatility, Artisan High Income is 2.29 times less risky than Franklin Founding. It trades about 0.36 of its potential returns per unit of risk. Franklin Founding Funds is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 1,601 in Franklin Founding Funds on September 13, 2024 and sell it today you would earn a total of 31.00 from holding Franklin Founding Funds or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Artisan High Income vs. Franklin Founding Funds
Performance |
| Timeline |
| Artisan High Income |
| Franklin Founding Funds |
Artisan High and Franklin Founding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan High and Franklin Founding
The main advantage of trading using opposite Artisan High and Franklin Founding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan High position performs unexpectedly, Franklin Founding 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 Founding will offset losses from the drop in Franklin Founding's long position.| Artisan High vs. Rbb Fund | Artisan High vs. Acm Dynamic Opportunity | Artisan High vs. Aam Select Income | Artisan High vs. Materials Portfolio Fidelity |
| Franklin Founding vs. Artisan High Income | Franklin Founding vs. Multisector Bond Sma | Franklin Founding vs. California Bond Fund | Franklin Founding vs. Bbh Intermediate Municipal |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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