Correlation Between Franklin Templeton and Tema Electrification
Can any of the company-specific risk be diversified away by investing in both Franklin Templeton and Tema Electrification 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 Tema Electrification 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 Tema Electrification ETF, you can compare the effects of market volatilities on Franklin Templeton and Tema Electrification 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 Tema Electrification. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Templeton and Tema Electrification.
Diversification Opportunities for Franklin Templeton and Tema Electrification
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Franklin and Tema is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Templeton ETF and Tema Electrification ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tema Electrification ETF 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 Tema Electrification. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tema Electrification ETF has no effect on the direction of Franklin Templeton i.e., Franklin Templeton and Tema Electrification go up and down completely randomly.
Pair Corralation between Franklin Templeton and Tema Electrification
Given the investment horizon of 90 days Franklin Templeton ETF is expected to generate 0.65 times more return on investment than Tema Electrification. However, Franklin Templeton ETF is 1.53 times less risky than Tema Electrification. It trades about 0.17 of its potential returns per unit of risk. Tema Electrification ETF is currently generating about -0.42 per unit of risk. If you would invest 2,669 in Franklin Templeton ETF on September 15, 2024 and sell it today you would earn a total of 68.00 from holding Franklin Templeton ETF or generate 2.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 42.86% |
| Values | Daily Returns |
Franklin Templeton ETF vs. Tema Electrification ETF
Performance |
| Timeline |
| Franklin Templeton ETF |
| Tema Electrification ETF |
Franklin Templeton and Tema Electrification Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Templeton and Tema Electrification
The main advantage of trading using opposite Franklin Templeton and Tema Electrification positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Templeton position performs unexpectedly, Tema Electrification 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 Tema Electrification will offset losses from the drop in Tema Electrification's long position.| Franklin Templeton vs. Franklin Core Dividend | Franklin Templeton vs. Franklin International Core | Franklin Templeton vs. WisdomTree Trust | Franklin Templeton vs. First Trust Exchange Traded |
| Tema Electrification vs. Freedom Day Dividend | Tema Electrification vs. Franklin Templeton ETF | Tema Electrification vs. iShares MSCI China | Tema Electrification vs. Tidal Trust II |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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