Correlation Between Franklin Templeton and REX FANG
Can any of the company-specific risk be diversified away by investing in both Franklin Templeton and REX FANG 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 Templeton and REX FANG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Templeton ETF and REX FANG Innovation, you can compare the effects of market volatilities on Franklin Templeton and REX FANG 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 Templeton with a short position of REX FANG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Templeton and REX FANG.
Diversification Opportunities for Franklin Templeton and REX FANG
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Franklin and REX is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Templeton ETF and REX FANG Innovation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REX FANG Innovation and Franklin Templeton 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 Templeton ETF are associated (or correlated) with REX FANG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REX FANG Innovation has no effect on the direction of Franklin Templeton i.e., Franklin Templeton and REX FANG go up and down completely randomly.
Pair Corralation between Franklin Templeton and REX FANG
Given the investment horizon of 90 days Franklin Templeton ETF is expected to under-perform the REX FANG. In addition to that, Franklin Templeton is 1.17 times more volatile than REX FANG Innovation. It trades about -0.05 of its total potential returns per unit of risk. REX FANG Innovation is currently generating about 0.22 per unit of volatility. If you would invest 4,921 in REX FANG Innovation on September 1, 2024 and sell it today you would earn a total of 199.00 from holding REX FANG Innovation or generate 4.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Templeton ETF vs. REX FANG Innovation
Performance |
| Timeline |
| Franklin Templeton ETF |
| REX FANG Innovation |
Franklin Templeton and REX FANG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Templeton and REX FANG
The main advantage of trading using opposite Franklin Templeton and REX FANG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Templeton position performs unexpectedly, REX FANG 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 REX FANG will offset losses from the drop in REX FANG's long position.| Franklin Templeton vs. Xtrackers MSCI Emerging | Franklin Templeton vs. FlexShares Morningstar Emerging | Franklin Templeton vs. First Trust Emerging |
| REX FANG vs. Freedom Day Dividend | REX FANG vs. iShares MSCI China | REX FANG vs. iShares Dividend and | REX FANG vs. SmartETFs Dividend Builder |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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