Correlation Between Sterling Capital and Franklin New
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Franklin New 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 Sterling Capital and Franklin New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Short and Franklin New Jersey, you can compare the effects of market volatilities on Sterling Capital and Franklin New 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 Sterling Capital with a short position of Franklin New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Franklin New.
Diversification Opportunities for Sterling Capital and Franklin New
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sterling and Franklin is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Franklin New Jersey in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin New Jersey and Sterling Capital 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 Sterling Capital Short are associated (or correlated) with Franklin New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin New Jersey has no effect on the direction of Sterling Capital i.e., Sterling Capital and Franklin New go up and down completely randomly.
Pair Corralation between Sterling Capital and Franklin New
Assuming the 90 days horizon Sterling Capital Short is expected to generate 0.51 times more return on investment than Franklin New. However, Sterling Capital Short is 1.95 times less risky than Franklin New. It trades about 0.18 of its potential returns per unit of risk. Franklin New Jersey is currently generating about -0.03 per unit of risk. If you would invest 826.00 in Sterling Capital Short on November 27, 2024 and sell it today you would earn a total of 11.00 from holding Sterling Capital Short or generate 1.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Short vs. Franklin New Jersey
Performance |
| Timeline |
| Sterling Capital Short |
| Franklin New Jersey |
Sterling Capital and Franklin New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Franklin New
The main advantage of trading using opposite Sterling Capital and Franklin New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Franklin New 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 New will offset losses from the drop in Franklin New's long position.| Sterling Capital vs. World Precious Minerals | Sterling Capital vs. Global Gold Fund | Sterling Capital vs. Investment Managers Series | Sterling Capital vs. Deutsche Gold Precious |
| Franklin New vs. Ab Bond Inflation | Franklin New vs. Ultra Short Fixed Income | Franklin New vs. Multisector Bond Sma | Franklin New vs. Nationwide E Plus |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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