Correlation Between Franklin Covey and Amentum Holdings
Can any of the company-specific risk be diversified away by investing in both Franklin Covey and Amentum Holdings 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 Franklin Covey and Amentum Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Covey and Amentum Holdings, you can compare the effects of market volatilities on Franklin Covey and Amentum Holdings 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 Franklin Covey with a short position of Amentum Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Covey and Amentum Holdings.
Diversification Opportunities for Franklin Covey and Amentum Holdings
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Franklin and Amentum is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Covey and Amentum Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amentum Holdings and Franklin Covey 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 Franklin Covey are associated (or correlated) with Amentum Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amentum Holdings has no effect on the direction of Franklin Covey i.e., Franklin Covey and Amentum Holdings go up and down completely randomly.
Pair Corralation between Franklin Covey and Amentum Holdings
Allowing for the 90-day total investment horizon Franklin Covey is expected to generate 0.4 times more return on investment than Amentum Holdings. However, Franklin Covey is 2.52 times less risky than Amentum Holdings. It trades about -0.01 of its potential returns per unit of risk. Amentum Holdings is currently generating about -0.04 per unit of risk. If you would invest 4,751 in Franklin Covey on September 3, 2024 and sell it today you would lose (1,113) from holding Franklin Covey or give up 23.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 9.9% |
| Values | Daily Returns |
Franklin Covey vs. Amentum Holdings
Performance |
| Timeline |
| Franklin Covey |
| Amentum Holdings |
Franklin Covey and Amentum Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Covey and Amentum Holdings
The main advantage of trading using opposite Franklin Covey and Amentum Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Covey position performs unexpectedly, Amentum Holdings 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 Amentum Holdings will offset losses from the drop in Amentum Holdings' long position.| Franklin Covey vs. CRA International | Franklin Covey vs. Thermon Group Holdings | Franklin Covey vs. Forrester Research | Franklin Covey vs. Forestar Group |
| Amentum Holdings vs. Zoom Video Communications | Amentum Holdings vs. Snowflake | Amentum Holdings vs. Workday | Amentum Holdings vs. C3 Ai Inc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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