Correlation Between Franklin Adjustable and Oklahoma Municipal
Can any of the company-specific risk be diversified away by investing in both Franklin Adjustable and Oklahoma Municipal 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 Adjustable and Oklahoma Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Adjustable Government and Oklahoma Municipal Fund, you can compare the effects of market volatilities on Franklin Adjustable and Oklahoma Municipal 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 Adjustable with a short position of Oklahoma Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Adjustable and Oklahoma Municipal.
Diversification Opportunities for Franklin Adjustable and Oklahoma Municipal
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Franklin and Oklahoma is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Adjustable Government and Oklahoma Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklahoma Municipal and Franklin Adjustable 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 Adjustable Government are associated (or correlated) with Oklahoma Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oklahoma Municipal has no effect on the direction of Franklin Adjustable i.e., Franklin Adjustable and Oklahoma Municipal go up and down completely randomly.
Pair Corralation between Franklin Adjustable and Oklahoma Municipal
Assuming the 90 days horizon Franklin Adjustable Government is expected to generate 0.49 times more return on investment than Oklahoma Municipal. However, Franklin Adjustable Government is 2.05 times less risky than Oklahoma Municipal. It trades about 0.14 of its potential returns per unit of risk. Oklahoma Municipal Fund is currently generating about 0.01 per unit of risk. If you would invest 722.00 in Franklin Adjustable Government on November 9, 2024 and sell it today you would earn a total of 32.00 from holding Franklin Adjustable Government or generate 4.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Adjustable Government vs. Oklahoma Municipal Fund
Performance |
| Timeline |
| Franklin Adjustable |
| Oklahoma Municipal |
Franklin Adjustable and Oklahoma Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Adjustable and Oklahoma Municipal
The main advantage of trading using opposite Franklin Adjustable and Oklahoma Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Adjustable position performs unexpectedly, Oklahoma Municipal 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 Oklahoma Municipal will offset losses from the drop in Oklahoma Municipal's long position.| Franklin Adjustable vs. Ab Global Bond | Franklin Adjustable vs. Goldman Sachs Short | Franklin Adjustable vs. Blrc Sgy Mnp | Franklin Adjustable vs. Siit High Yield |
| Oklahoma Municipal vs. Us Vector Equity | Oklahoma Municipal vs. Transamerica International Equity | Oklahoma Municipal vs. Dreyfusstandish Global Fixed | Oklahoma Municipal vs. Dreyfusstandish Global Fixed |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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