Correlation Between Franklin Small and Artisan Select
Can any of the company-specific risk be diversified away by investing in both Franklin Small and Artisan Select 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 Small and Artisan Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Small Cap and Artisan Select Equity, you can compare the effects of market volatilities on Franklin Small and Artisan Select 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 Small with a short position of Artisan Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Small and Artisan Select.
Diversification Opportunities for Franklin Small and Artisan Select
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Franklin and Artisan is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Small Cap and Artisan Select Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Select Equity and Franklin Small 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 Small Cap are associated (or correlated) with Artisan Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Select Equity has no effect on the direction of Franklin Small i.e., Franklin Small and Artisan Select go up and down completely randomly.
Pair Corralation between Franklin Small and Artisan Select
Assuming the 90 days horizon Franklin Small is expected to generate 1.18 times less return on investment than Artisan Select. In addition to that, Franklin Small is 1.34 times more volatile than Artisan Select Equity. It trades about 0.29 of its total potential returns per unit of risk. Artisan Select Equity is currently generating about 0.45 per unit of volatility. If you would invest 1,535 in Artisan Select Equity on November 3, 2024 and sell it today you would earn a total of 111.00 from holding Artisan Select Equity or generate 7.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Small Cap vs. Artisan Select Equity
Performance |
| Timeline |
| Franklin Small Cap |
| Artisan Select Equity |
Franklin Small and Artisan Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Small and Artisan Select
The main advantage of trading using opposite Franklin Small and Artisan Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Small position performs unexpectedly, Artisan Select 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 Artisan Select will offset losses from the drop in Artisan Select's long position.| Franklin Small vs. Angel Oak Financial | Franklin Small vs. Touchstone Ultra Short | Franklin Small vs. Ab Global Bond | Franklin Small vs. Ab Bond Inflation |
| Artisan Select vs. Valic Company I | Artisan Select vs. Lsv Small Cap | Artisan Select vs. Queens Road Small | Artisan Select vs. Heartland Value Plus |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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