Correlation Between Pro-blend(r) Moderate and Franklin Templeton
Can any of the company-specific risk be diversified away by investing in both Pro-blend(r) Moderate 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 Pro-blend(r) Moderate and Franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pro Blend Moderate Term and Franklin Templeton Smacs, you can compare the effects of market volatilities on Pro-blend(r) Moderate 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 Pro-blend(r) Moderate with a short position of Franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pro-blend(r) Moderate and Franklin Templeton.
Diversification Opportunities for Pro-blend(r) Moderate and Franklin Templeton
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pro-blend(r) and Franklin is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Pro Blend Moderate Term and Franklin Templeton Smacs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Templeton Smacs and Pro-blend(r) Moderate 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 Pro Blend Moderate Term 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 Smacs has no effect on the direction of Pro-blend(r) Moderate i.e., Pro-blend(r) Moderate and Franklin Templeton go up and down completely randomly.
Pair Corralation between Pro-blend(r) Moderate and Franklin Templeton
Assuming the 90 days horizon Pro-blend(r) Moderate is expected to generate 1.27 times less return on investment than Franklin Templeton. But when comparing it to its historical volatility, Pro Blend Moderate Term is 3.27 times less risky than Franklin Templeton. It trades about 0.11 of its potential returns per unit of risk. Franklin Templeton Smacs is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 816.00 in Franklin Templeton Smacs on September 1, 2024 and sell it today you would earn a total of 70.00 from holding Franklin Templeton Smacs or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Pro Blend Moderate Term vs. Franklin Templeton Smacs
Performance |
| Timeline |
| Pro-blend(r) Moderate |
| Franklin Templeton Smacs |
Pro-blend(r) Moderate and Franklin Templeton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pro-blend(r) Moderate and Franklin Templeton
The main advantage of trading using opposite Pro-blend(r) Moderate and Franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pro-blend(r) Moderate 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.| Pro-blend(r) Moderate vs. Pro Blend Servative Term | Pro-blend(r) Moderate vs. Pro Blend Extended Term | Pro-blend(r) Moderate vs. Pro Blend Maximum Term | Pro-blend(r) Moderate vs. Greenspring Fund Retail |
| Franklin Templeton vs. Small Pany Growth | Franklin Templeton vs. L Abbett Growth | Franklin Templeton vs. Chase Growth Fund | Franklin Templeton vs. T Rowe Price |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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