Correlation Between Franklin International and Mutual Of

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Can any of the company-specific risk be diversified away by investing in both Franklin International and Mutual Of 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 International and Mutual Of into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin International Core and Mutual Of America, you can compare the effects of market volatilities on Franklin International and Mutual Of 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 International with a short position of Mutual Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin International and Mutual Of.

Diversification Opportunities for Franklin International and Mutual Of

-0.67
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Franklin and Mutual is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Franklin International Core and Mutual Of America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mutual Of America and Franklin International 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 International Core are associated (or correlated) with Mutual Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mutual Of America has no effect on the direction of Franklin International i.e., Franklin International and Mutual Of go up and down completely randomly.

Pair Corralation between Franklin International and Mutual Of

Assuming the 90 days horizon Franklin International Core is expected to generate 0.82 times more return on investment than Mutual Of. However, Franklin International Core is 1.22 times less risky than Mutual Of. It trades about 0.14 of its potential returns per unit of risk. Mutual Of America is currently generating about -0.04 per unit of risk. If you would invest  1,195  in Franklin International Core on September 13, 2024 and sell it today you would earn a total of  21.00  from holding Franklin International Core or generate 1.76% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy95.45%
ValuesDaily Returns

Franklin International Core  vs.  Mutual Of America

 Performance 
       Timeline  
Franklin International 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Franklin International Core has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Franklin International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Mutual Of America 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Mutual Of America are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking signals, Mutual Of may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Franklin International and Mutual Of Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Franklin International and Mutual Of

The main advantage of trading using opposite Franklin International and Mutual Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin International position performs unexpectedly, Mutual Of 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 Mutual Of will offset losses from the drop in Mutual Of's long position.
The idea behind Franklin International Core and Mutual Of America pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..

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