Correlation Between Fulcrum Diversified and Franklin Strategic
Can any of the company-specific risk be diversified away by investing in both Fulcrum Diversified and Franklin Strategic 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 Fulcrum Diversified and Franklin Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fulcrum Diversified Absolute and Franklin Strategic Income, you can compare the effects of market volatilities on Fulcrum Diversified and Franklin Strategic 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 Fulcrum Diversified with a short position of Franklin Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fulcrum Diversified and Franklin Strategic.
Diversification Opportunities for Fulcrum Diversified and Franklin Strategic
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fulcrum and Franklin is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Fulcrum Diversified Absolute and Franklin Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Strategic Income and Fulcrum Diversified 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 Fulcrum Diversified Absolute are associated (or correlated) with Franklin Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Strategic Income has no effect on the direction of Fulcrum Diversified i.e., Fulcrum Diversified and Franklin Strategic go up and down completely randomly.
Pair Corralation between Fulcrum Diversified and Franklin Strategic
Assuming the 90 days horizon Fulcrum Diversified Absolute is expected to under-perform the Franklin Strategic. In addition to that, Fulcrum Diversified is 5.16 times more volatile than Franklin Strategic Income. It trades about -0.13 of its total potential returns per unit of risk. Franklin Strategic Income is currently generating about 0.21 per unit of volatility. If you would invest 829.00 in Franklin Strategic Income on September 13, 2024 and sell it today you would earn a total of 7.00 from holding Franklin Strategic Income or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fulcrum Diversified Absolute vs. Franklin Strategic Income
Performance |
| Timeline |
| Fulcrum Diversified |
| Franklin Strategic Income |
Fulcrum Diversified and Franklin Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fulcrum Diversified and Franklin Strategic
The main advantage of trading using opposite Fulcrum Diversified and Franklin Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fulcrum Diversified position performs unexpectedly, Franklin Strategic 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 Strategic will offset losses from the drop in Franklin Strategic's long position.| Fulcrum Diversified vs. Fidelity Advisor Gold | Fulcrum Diversified vs. Invesco Gold Special | Fulcrum Diversified vs. Precious Metals And | Fulcrum Diversified vs. James Balanced Golden |
| Franklin Strategic vs. Franklin Mutual Beacon | Franklin Strategic vs. Templeton Developing Markets | Franklin Strategic vs. Franklin Mutual Global | Franklin Strategic vs. Franklin Mutual Global |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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