Correlation Between Eic Value and Franklin High
Can any of the company-specific risk be diversified away by investing in both Eic Value and Franklin High 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 Eic Value and Franklin High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eic Value Fund and Franklin High Income, you can compare the effects of market volatilities on Eic Value and Franklin High 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 Eic Value with a short position of Franklin High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eic Value and Franklin High.
Diversification Opportunities for Eic Value and Franklin High
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eic and Franklin is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Eic Value Fund and Franklin High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin High Income and Eic Value 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 Eic Value Fund are associated (or correlated) with Franklin High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin High Income has no effect on the direction of Eic Value i.e., Eic Value and Franklin High go up and down completely randomly.
Pair Corralation between Eic Value and Franklin High
Assuming the 90 days horizon Eic Value Fund is expected to generate 2.79 times more return on investment than Franklin High. However, Eic Value is 2.79 times more volatile than Franklin High Income. It trades about 0.12 of its potential returns per unit of risk. Franklin High Income is currently generating about 0.16 per unit of risk. If you would invest 1,749 in Eic Value Fund on August 29, 2024 and sell it today you would earn a total of 167.00 from holding Eic Value Fund or generate 9.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eic Value Fund vs. Franklin High Income
Performance |
| Timeline |
| Eic Value Fund |
| Franklin High Income |
Eic Value and Franklin High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eic Value and Franklin High
The main advantage of trading using opposite Eic Value and Franklin High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eic Value position performs unexpectedly, Franklin High 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 High will offset losses from the drop in Franklin High's long position.| Eic Value vs. Pgim Jennison Technology | Eic Value vs. Red Oak Technology | Eic Value vs. Allianzgi Technology Fund | Eic Value vs. Towpath Technology |
| Franklin High vs. Eic Value Fund | Franklin High vs. L Abbett Fundamental | Franklin High vs. Materials Portfolio Fidelity | Franklin High vs. Qs Growth Fund |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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