Correlation Between Franklin Emerging and Rbc Bluebay
Can any of the company-specific risk be diversified away by investing in both Franklin Emerging and Rbc Bluebay 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 Rbc Bluebay 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 Rbc Bluebay Emerging, you can compare the effects of market volatilities on Franklin Emerging and Rbc Bluebay 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 Rbc Bluebay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Emerging and Rbc Bluebay.
Diversification Opportunities for Franklin Emerging and Rbc Bluebay
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Franklin and Rbc is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Emerging Market and Rbc Bluebay Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Bluebay Emerging 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 Rbc Bluebay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Bluebay Emerging has no effect on the direction of Franklin Emerging i.e., Franklin Emerging and Rbc Bluebay go up and down completely randomly.
Pair Corralation between Franklin Emerging and Rbc Bluebay
Assuming the 90 days horizon Franklin Emerging Market is expected to generate 0.68 times more return on investment than Rbc Bluebay. However, Franklin Emerging Market is 1.47 times less risky than Rbc Bluebay. It trades about 0.23 of its potential returns per unit of risk. Rbc Bluebay Emerging is currently generating about 0.12 per unit of risk. If you would invest 1,088 in Franklin Emerging Market on August 28, 2024 and sell it today you would earn a total of 127.00 from holding Franklin Emerging Market or generate 11.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
Franklin Emerging Market vs. Rbc Bluebay Emerging
Performance |
| Timeline |
| Franklin Emerging Market |
| Rbc Bluebay Emerging |
Franklin Emerging and Rbc Bluebay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Emerging and Rbc Bluebay
The main advantage of trading using opposite Franklin Emerging and Rbc Bluebay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Emerging position performs unexpectedly, Rbc Bluebay 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 Rbc Bluebay will offset losses from the drop in Rbc Bluebay's long position.| Franklin Emerging vs. Franklin Mutual Beacon | Franklin Emerging vs. Templeton Developing Markets | Franklin Emerging vs. Franklin Mutual Global | Franklin Emerging vs. Franklin Mutual Global |
| Rbc Bluebay vs. Rbc Small Cap | Rbc Bluebay vs. Rbc Enterprise Fund | Rbc Bluebay vs. Rbc Enterprise Fund | Rbc Bluebay vs. Rbc Emerging Markets |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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