Correlation Between Eaton Vance and Franklin Templeton
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Franklin Templeton 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 Eaton Vance and Franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Senior and Franklin Templeton Limited, you can compare the effects of market volatilities on Eaton Vance and Franklin Templeton 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 Eaton Vance with a short position of Franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Franklin Templeton.
Diversification Opportunities for Eaton Vance and Franklin Templeton
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eaton and Franklin is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Senior and Franklin Templeton Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Templeton and Eaton Vance 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 Eaton Vance Senior are associated (or correlated) with Franklin Templeton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Templeton has no effect on the direction of Eaton Vance i.e., Eaton Vance and Franklin Templeton go up and down completely randomly.
Pair Corralation between Eaton Vance and Franklin Templeton
Considering the 90-day investment horizon Eaton Vance is expected to generate 1.63 times less return on investment than Franklin Templeton. But when comparing it to its historical volatility, Eaton Vance Senior is 1.15 times less risky than Franklin Templeton. It trades about 0.11 of its potential returns per unit of risk. Franklin Templeton Limited is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 645.00 in Franklin Templeton Limited on August 29, 2024 and sell it today you would earn a total of 12.00 from holding Franklin Templeton Limited or generate 1.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Senior vs. Franklin Templeton Limited
Performance |
| Timeline |
| Eaton Vance Senior |
| Franklin Templeton |
Eaton Vance and Franklin Templeton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Franklin Templeton
The main advantage of trading using opposite Eaton Vance and Franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Franklin Templeton 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 Templeton will offset losses from the drop in Franklin Templeton's long position.| Eaton Vance vs. MFS Investment Grade | Eaton Vance vs. Invesco High Income | Eaton Vance vs. Eaton Vance National | Eaton Vance vs. Nuveen California Select |
| Franklin Templeton vs. Eaton Vance National | Franklin Templeton vs. Invesco High Income | Franklin Templeton vs. Blackrock Muniholdings Ny | Franklin Templeton vs. Nuveen California Select |
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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