Correlation Between Alger Funds and Ftfa Franklin
Can any of the company-specific risk be diversified away by investing in both Alger Funds and Ftfa Franklin 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 Alger Funds and Ftfa Franklin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Alger Funds and Ftfa Franklin Templeton Growth, you can compare the effects of market volatilities on Alger Funds and Ftfa Franklin 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 Alger Funds with a short position of Ftfa Franklin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Funds and Ftfa Franklin.
Diversification Opportunities for Alger Funds and Ftfa Franklin
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Alger and Ftfa is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding The Alger Funds and Ftfa Franklin Templeton Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ftfa Franklin Templeton and Alger Funds 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 The Alger Funds are associated (or correlated) with Ftfa Franklin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ftfa Franklin Templeton has no effect on the direction of Alger Funds i.e., Alger Funds and Ftfa Franklin go up and down completely randomly.
Pair Corralation between Alger Funds and Ftfa Franklin
Assuming the 90 days horizon The Alger Funds is expected to generate 1.98 times more return on investment than Ftfa Franklin. However, Alger Funds is 1.98 times more volatile than Ftfa Franklin Templeton Growth. It trades about 0.06 of its potential returns per unit of risk. Ftfa Franklin Templeton Growth is currently generating about 0.1 per unit of risk. If you would invest 862.00 in The Alger Funds on September 12, 2024 and sell it today you would earn a total of 324.00 from holding The Alger Funds or generate 37.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
The Alger Funds vs. Ftfa Franklin Templeton Growth
Performance |
| Timeline |
| Alger Funds |
| Ftfa Franklin Templeton |
Alger Funds and Ftfa Franklin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger Funds and Ftfa Franklin
The main advantage of trading using opposite Alger Funds and Ftfa Franklin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Funds position performs unexpectedly, Ftfa Franklin 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 Ftfa Franklin will offset losses from the drop in Ftfa Franklin's long position.| Alger Funds vs. Needham Aggressive Growth | Alger Funds vs. Ultramid Cap Profund Ultramid Cap | Alger Funds vs. HUMANA INC | Alger Funds vs. Barloworld Ltd ADR |
| Ftfa Franklin vs. Income Fund Of | Ftfa Franklin vs. Income Fund Of | Ftfa Franklin vs. Income Fund Of | Ftfa Franklin vs. Income Fund Of |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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