Correlation Between Franklin California and Americafirst Large
Can any of the company-specific risk be diversified away by investing in both Franklin California and Americafirst Large 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 California and Americafirst Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin California Tax Free and Americafirst Large Cap, you can compare the effects of market volatilities on Franklin California and Americafirst Large 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 California with a short position of Americafirst Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin California and Americafirst Large.
Diversification Opportunities for Franklin California and Americafirst Large
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Franklin and Americafirst is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Franklin California Tax Free and Americafirst Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americafirst Large Cap and Franklin California 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 California Tax Free are associated (or correlated) with Americafirst Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americafirst Large Cap has no effect on the direction of Franklin California i.e., Franklin California and Americafirst Large go up and down completely randomly.
Pair Corralation between Franklin California and Americafirst Large
Assuming the 90 days horizon Franklin California Tax Free is expected to generate 0.21 times more return on investment than Americafirst Large. However, Franklin California Tax Free is 4.67 times less risky than Americafirst Large. It trades about 0.33 of its potential returns per unit of risk. Americafirst Large Cap is currently generating about -0.11 per unit of risk. If you would invest 686.00 in Franklin California Tax Free on September 13, 2024 and sell it today you would earn a total of 7.00 from holding Franklin California Tax Free or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin California Tax Free vs. Americafirst Large Cap
Performance |
| Timeline |
| Franklin California Tax |
| Americafirst Large Cap |
Franklin California and Americafirst Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin California and Americafirst Large
The main advantage of trading using opposite Franklin California and Americafirst Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin California position performs unexpectedly, Americafirst Large 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 Americafirst Large will offset losses from the drop in Americafirst Large's long position.| Franklin California vs. Franklin Mutual Beacon | Franklin California vs. Templeton Developing Markets | Franklin California vs. Franklin Mutual Global | Franklin California vs. Franklin Mutual Global |
| Americafirst Large vs. Scharf Global Opportunity | Americafirst Large vs. Ab Value Fund | Americafirst Large vs. Rbc Microcap Value | Americafirst Large 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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