Correlation Between Calvert Global and Franklin Small
Can any of the company-specific risk be diversified away by investing in both Calvert Global and Franklin Small 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 Calvert Global and Franklin Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Global Energy and Franklin Small Mid Cap, you can compare the effects of market volatilities on Calvert Global and Franklin Small 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 Calvert Global with a short position of Franklin Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Global and Franklin Small.
Diversification Opportunities for Calvert Global and Franklin Small
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Calvert and Franklin is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Global Energy and Franklin Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Small Mid and Calvert 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 Calvert Global Energy are associated (or correlated) with Franklin Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Small Mid has no effect on the direction of Calvert Global i.e., Calvert Global and Franklin Small go up and down completely randomly.
Pair Corralation between Calvert Global and Franklin Small
Assuming the 90 days horizon Calvert Global Energy is expected to generate 0.68 times more return on investment than Franklin Small. However, Calvert Global Energy is 1.47 times less risky than Franklin Small. It trades about -0.21 of its potential returns per unit of risk. Franklin Small Mid Cap is currently generating about -0.15 per unit of risk. If you would invest 1,099 in Calvert Global Energy on September 27, 2024 and sell it today you would lose (39.00) from holding Calvert Global Energy or give up 3.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Global Energy vs. Franklin Small Mid Cap
Performance |
| Timeline |
| Calvert Global Energy |
| Franklin Small Mid |
Calvert Global and Franklin Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Global and Franklin Small
The main advantage of trading using opposite Calvert Global and Franklin Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Global position performs unexpectedly, Franklin Small 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 Small will offset losses from the drop in Franklin Small's long position.| Calvert Global vs. Dimensional Retirement Income | Calvert Global vs. Putnman Retirement Ready | Calvert Global vs. Pro Blend Moderate Term | Calvert Global vs. Qs Moderate Growth |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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