Correlation Between Eagle Mlp and Franklin Convertible
Can any of the company-specific risk be diversified away by investing in both Eagle Mlp and Franklin Convertible 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 Eagle Mlp and Franklin Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Mlp Strategy and Franklin Vertible Securities, you can compare the effects of market volatilities on Eagle Mlp and Franklin Convertible 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 Eagle Mlp with a short position of Franklin Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Mlp and Franklin Convertible.
Diversification Opportunities for Eagle Mlp and Franklin Convertible
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Eagle and Franklin is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Mlp Strategy and Franklin Vertible Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Convertible and Eagle Mlp 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 Eagle Mlp Strategy are associated (or correlated) with Franklin Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Convertible has no effect on the direction of Eagle Mlp i.e., Eagle Mlp and Franklin Convertible go up and down completely randomly.
Pair Corralation between Eagle Mlp and Franklin Convertible
Assuming the 90 days horizon Eagle Mlp Strategy is expected to generate 1.8 times more return on investment than Franklin Convertible. However, Eagle Mlp is 1.8 times more volatile than Franklin Vertible Securities. It trades about 0.58 of its potential returns per unit of risk. Franklin Vertible Securities is currently generating about 0.52 per unit of risk. If you would invest 978.00 in Eagle Mlp Strategy on August 31, 2024 and sell it today you would earn a total of 137.00 from holding Eagle Mlp Strategy or generate 14.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Mlp Strategy vs. Franklin Vertible Securities
Performance |
| Timeline |
| Eagle Mlp Strategy |
| Franklin Convertible |
Eagle Mlp and Franklin Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Mlp and Franklin Convertible
The main advantage of trading using opposite Eagle Mlp and Franklin Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Mlp position performs unexpectedly, Franklin Convertible 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 Convertible will offset losses from the drop in Franklin Convertible's long position.| Eagle Mlp vs. The Gabelli Healthcare | Eagle Mlp vs. Hartford Healthcare Hls | Eagle Mlp vs. Eventide Healthcare Life | Eagle Mlp vs. Invesco Global Health |
| Franklin Convertible vs. Vanguard Growth And | Franklin Convertible vs. Ab Small Cap | Franklin Convertible vs. Victory Rs Small | Franklin Convertible vs. Rational Defensive Growth |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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