Correlation Between Ethereum and Franklin Financial
Can any of the company-specific risk be diversified away by investing in both Ethereum and Franklin Financial 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 Ethereum and Franklin Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ethereum and Franklin Financial Services, you can compare the effects of market volatilities on Ethereum and Franklin Financial 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 Ethereum with a short position of Franklin Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ethereum and Franklin Financial.
Diversification Opportunities for Ethereum and Franklin Financial
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ethereum and Franklin is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ethereum and Franklin Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Financial and Ethereum 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 Ethereum are associated (or correlated) with Franklin Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Financial has no effect on the direction of Ethereum i.e., Ethereum and Franklin Financial go up and down completely randomly.
Pair Corralation between Ethereum and Franklin Financial
Assuming the 90 days trading horizon Ethereum is expected to under-perform the Franklin Financial. In addition to that, Ethereum is 1.54 times more volatile than Franklin Financial Services. It trades about -0.11 of its total potential returns per unit of risk. Franklin Financial Services is currently generating about 0.33 per unit of volatility. If you would invest 2,925 in Franklin Financial Services on November 2, 2024 and sell it today you would earn a total of 467.00 from holding Franklin Financial Services or generate 15.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Ethereum vs. Franklin Financial Services
Performance |
| Timeline |
| Ethereum |
| Franklin Financial |
Ethereum and Franklin Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ethereum and Franklin Financial
The main advantage of trading using opposite Ethereum and Franklin Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ethereum position performs unexpectedly, Franklin Financial 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 Financial will offset losses from the drop in Franklin Financial's long position.The idea behind Ethereum and Franklin Financial Services pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Franklin Financial vs. Magyar Bancorp | Franklin Financial vs. Affinity Bancshares | Franklin Financial vs. Home Federal Bancorp | Franklin Financial vs. Sound Financial Bancorp |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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