Correlation Between Franklin Emerging and Catalyst/millburn
Can any of the company-specific risk be diversified away by investing in both Franklin Emerging and Catalyst/millburn 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 Emerging and Catalyst/millburn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Emerging Market and Catalystmillburn Hedge Strategy, you can compare the effects of market volatilities on Franklin Emerging and Catalyst/millburn 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 Emerging with a short position of Catalyst/millburn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Emerging and Catalyst/millburn.
Diversification Opportunities for Franklin Emerging and Catalyst/millburn
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Franklin and Catalyst/millburn is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Emerging Market and Catalystmillburn Hedge Strateg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystmillburn Hedge and Franklin Emerging 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 Emerging Market are associated (or correlated) with Catalyst/millburn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystmillburn Hedge has no effect on the direction of Franklin Emerging i.e., Franklin Emerging and Catalyst/millburn go up and down completely randomly.
Pair Corralation between Franklin Emerging and Catalyst/millburn
Assuming the 90 days horizon Franklin Emerging is expected to generate 8.11 times less return on investment than Catalyst/millburn. But when comparing it to its historical volatility, Franklin Emerging Market is 2.49 times less risky than Catalyst/millburn. It trades about 0.06 of its potential returns per unit of risk. Catalystmillburn Hedge Strategy is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3,697 in Catalystmillburn Hedge Strategy on October 18, 2024 and sell it today you would earn a total of 327.00 from holding Catalystmillburn Hedge Strategy or generate 8.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Emerging Market vs. Catalystmillburn Hedge Strateg
Performance |
| Timeline |
| Franklin Emerging Market |
| Catalystmillburn Hedge |
Franklin Emerging and Catalyst/millburn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Emerging and Catalyst/millburn
The main advantage of trading using opposite Franklin Emerging and Catalyst/millburn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Emerging position performs unexpectedly, Catalyst/millburn 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 Catalyst/millburn will offset losses from the drop in Catalyst/millburn's long position.| Franklin Emerging vs. Rbb Fund Trust | Franklin Emerging vs. Alliancebernstein Global Highome | Franklin Emerging vs. Transamerica Asset Allocation | Franklin Emerging vs. Tax Managed Large Cap |
| Catalyst/millburn vs. Ips Strategic Capital | Catalyst/millburn vs. Tax Managed Large Cap | Catalyst/millburn vs. Volumetric Fund Volumetric | Catalyst/millburn vs. Kirr Marbach Partners |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |