Correlation Between Franklin Mutual and Gqg Partners
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Gqg Partners 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 Franklin Mutual and Gqg Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual Beacon and Gqg Partners Global, you can compare the effects of market volatilities on Franklin Mutual and Gqg Partners 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 Franklin Mutual with a short position of Gqg Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Gqg Partners.
Diversification Opportunities for Franklin Mutual and Gqg Partners
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Franklin and Gqg is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual Beacon and Gqg Partners Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gqg Partners Global and Franklin Mutual 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 Franklin Mutual Beacon are associated (or correlated) with Gqg Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gqg Partners Global has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Gqg Partners go up and down completely randomly.
Pair Corralation between Franklin Mutual and Gqg Partners
Assuming the 90 days horizon Franklin Mutual is expected to generate 1.38 times less return on investment than Gqg Partners. In addition to that, Franklin Mutual is 1.26 times more volatile than Gqg Partners Global. It trades about 0.04 of its total potential returns per unit of risk. Gqg Partners Global is currently generating about 0.07 per unit of volatility. If you would invest 908.00 in Gqg Partners Global on September 3, 2024 and sell it today you would earn a total of 239.00 from holding Gqg Partners Global or generate 26.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual Beacon vs. Gqg Partners Global
Performance |
| Timeline |
| Franklin Mutual Beacon |
| Gqg Partners Global |
Franklin Mutual and Gqg Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Gqg Partners
The main advantage of trading using opposite Franklin Mutual and Gqg Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Gqg Partners 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 Gqg Partners will offset losses from the drop in Gqg Partners' long position.| Franklin Mutual vs. Franklin Mutual Global | Franklin Mutual vs. Franklin Mutual Shares | Franklin Mutual vs. Franklin Mutual Quest | Franklin Mutual vs. Franklin Mutual European |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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