Correlation Between Franklin Balance and Franklin Templeton
Can any of the company-specific risk be diversified away by investing in both Franklin Balance 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 Franklin Balance and Franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Balance Sheet and Franklin Templeton Multi Asset, you can compare the effects of market volatilities on Franklin Balance 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 Franklin Balance with a short position of Franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Balance and Franklin Templeton.
Diversification Opportunities for Franklin Balance and Franklin Templeton
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and Franklin is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Balance Sheet and Franklin Templeton Multi Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Templeton and Franklin Balance 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 Balance Sheet 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 Franklin Balance i.e., Franklin Balance and Franklin Templeton go up and down completely randomly.
Pair Corralation between Franklin Balance and Franklin Templeton
Assuming the 90 days horizon Franklin Balance Sheet is expected to generate 4.68 times more return on investment than Franklin Templeton. However, Franklin Balance is 4.68 times more volatile than Franklin Templeton Multi Asset. It trades about 0.08 of its potential returns per unit of risk. Franklin Templeton Multi Asset is currently generating about 0.17 per unit of risk. If you would invest 3,389 in Franklin Balance Sheet on September 3, 2024 and sell it today you would earn a total of 400.00 from holding Franklin Balance Sheet or generate 11.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Balance Sheet vs. Franklin Templeton Multi Asset
Performance |
| Timeline |
| Franklin Balance Sheet |
| Franklin Templeton |
Franklin Balance and Franklin Templeton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Balance and Franklin Templeton
The main advantage of trading using opposite Franklin Balance and Franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Balance 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.| Franklin Balance vs. Vanguard Institutional Short Term | Franklin Balance vs. Goldman Sachs Short | Franklin Balance vs. Jhancock Short Duration | Franklin Balance vs. Aqr Long Short Equity |
| Franklin Templeton vs. Deutsche Real Estate | Franklin Templeton vs. Goldman Sachs Real | Franklin Templeton vs. Columbia Real Estate | Franklin Templeton vs. Fidelity Real Estate |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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