Correlation Between Barings Global and Franklin India

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Can any of the company-specific risk be diversified away by investing in both Barings Global and Franklin India 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 Barings Global and Franklin India into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Global Floating and Franklin India Growth, you can compare the effects of market volatilities on Barings Global and Franklin India 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 Barings Global with a short position of Franklin India. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Global and Franklin India.

Diversification Opportunities for Barings Global and Franklin India

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Barings and Franklin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Barings Global Floating and Franklin India Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin India Growth and Barings Global 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 Barings Global Floating are associated (or correlated) with Franklin India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin India Growth has no effect on the direction of Barings Global i.e., Barings Global and Franklin India go up and down completely randomly.

Pair Corralation between Barings Global and Franklin India

If you would invest  875.00  in Barings Global Floating on September 3, 2024 and sell it today you would earn a total of  3.00  from holding Barings Global Floating or generate 0.34% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Barings Global Floating  vs.  Franklin India Growth

 Performance 
       Timeline  
Barings Global Floating 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Barings Global Floating are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Barings Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Franklin India Growth 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Franklin India Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Franklin India is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Barings Global and Franklin India Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Barings Global and Franklin India

The main advantage of trading using opposite Barings Global and Franklin India positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Global position performs unexpectedly, Franklin India 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 India will offset losses from the drop in Franklin India's long position.
The idea behind Barings Global Floating and Franklin India Growth pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.

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