Correlation Between Dow Jones and Franklin Floating
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By analyzing existing cross correlation between Dow Jones Industrial and Franklin Floating Rate, you can compare the effects of market volatilities on Dow Jones and Franklin Floating 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 Dow Jones with a short position of Franklin Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Franklin Floating.
Diversification Opportunities for Dow Jones and Franklin Floating
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dow and Franklin is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Franklin Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Floating Rate and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with Franklin Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Floating Rate has no effect on the direction of Dow Jones i.e., Dow Jones and Franklin Floating go up and down completely randomly.
Pair Corralation between Dow Jones and Franklin Floating
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 5.29 times more return on investment than Franklin Floating. However, Dow Jones is 5.29 times more volatile than Franklin Floating Rate. It trades about 0.11 of its potential returns per unit of risk. Franklin Floating Rate is currently generating about 0.27 per unit of risk. If you would invest 3,406,633 in Dow Jones Industrial on September 2, 2024 and sell it today you would earn a total of 1,084,432 from holding Dow Jones Industrial or generate 31.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.67% |
| Values | Daily Returns |
Dow Jones Industrial vs. Franklin Floating Rate
Performance |
| Timeline |
Dow Jones and Franklin Floating Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Franklin Floating Rate
Pair trading matchups for Franklin Floating
Pair Trading with Dow Jones and Franklin Floating
The main advantage of trading using opposite Dow Jones and Franklin Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Franklin Floating 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 Floating will offset losses from the drop in Franklin Floating's long position.| Dow Jones vs. Dream Finders Homes | Dow Jones vs. GEN Restaurant Group, | Dow Jones vs. National Beverage Corp | Dow Jones vs. BJs Restaurants |
| Franklin Floating vs. Franklin Floating Rate | Franklin Floating vs. Franklin Floating Rate | Franklin Floating vs. KLP AksjeNorge Indeks | Franklin Floating vs. Storebrand Global Solutions |
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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