Correlation Between Ab Global and Franklin California
Can any of the company-specific risk be diversified away by investing in both Ab Global and Franklin California 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 Ab Global and Franklin California into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Risk and Franklin California Intermediate Term, you can compare the effects of market volatilities on Ab Global and Franklin California 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 Ab Global with a short position of Franklin California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Franklin California.
Diversification Opportunities for Ab Global and Franklin California
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CABIX and Franklin is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Risk and Franklin California Intermedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin California and Ab 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 Ab Global Risk are associated (or correlated) with Franklin California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin California has no effect on the direction of Ab Global i.e., Ab Global and Franklin California go up and down completely randomly.
Pair Corralation between Ab Global and Franklin California
Assuming the 90 days horizon Ab Global Risk is expected to generate 3.24 times more return on investment than Franklin California. However, Ab Global is 3.24 times more volatile than Franklin California Intermediate Term. It trades about 0.11 of its potential returns per unit of risk. Franklin California Intermediate Term is currently generating about -0.03 per unit of risk. If you would invest 1,511 in Ab Global Risk on October 21, 2024 and sell it today you would earn a total of 16.00 from holding Ab Global Risk or generate 1.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Global Risk vs. Franklin California Intermedia
Performance |
| Timeline |
| Ab Global Risk |
| Franklin California |
Ab Global and Franklin California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and Franklin California
The main advantage of trading using opposite Ab Global and Franklin California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Franklin California 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 California will offset losses from the drop in Franklin California's long position.| Ab Global vs. Live Oak Health | Ab Global vs. Alger Health Sciences | Ab Global vs. Tekla Healthcare Investors | Ab Global vs. Deutsche Health And |
| Franklin California vs. Franklin Mutual Beacon | Franklin California vs. Templeton Developing Markets | Franklin California vs. Franklin Mutual Global | Franklin California vs. Franklin Mutual Global |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |