Correlation Between Franklin Emerging and Saat Market
Can any of the company-specific risk be diversified away by investing in both Franklin Emerging and Saat Market 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 Saat Market 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 Saat Market Growth, you can compare the effects of market volatilities on Franklin Emerging and Saat Market 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 Saat Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Emerging and Saat Market.
Diversification Opportunities for Franklin Emerging and Saat Market
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and Saat is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Emerging Market and Saat Market Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Market Growth 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 Saat Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Market Growth has no effect on the direction of Franklin Emerging i.e., Franklin Emerging and Saat Market go up and down completely randomly.
Pair Corralation between Franklin Emerging and Saat Market
Assuming the 90 days horizon Franklin Emerging is expected to generate 2.58 times less return on investment than Saat Market. But when comparing it to its historical volatility, Franklin Emerging Market is 2.88 times less risky than Saat Market. It trades about 0.36 of its potential returns per unit of risk. Saat Market Growth is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 2,736 in Saat Market Growth on November 4, 2024 and sell it today you would earn a total of 104.00 from holding Saat Market Growth or generate 3.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Emerging Market vs. Saat Market Growth
Performance |
| Timeline |
| Franklin Emerging Market |
| Saat Market Growth |
Franklin Emerging and Saat Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Emerging and Saat Market
The main advantage of trading using opposite Franklin Emerging and Saat Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Emerging position performs unexpectedly, Saat Market 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 Saat Market will offset losses from the drop in Saat Market's long position.| Franklin Emerging vs. Icon Natural Resources | Franklin Emerging vs. Fidelity Advisor Energy | Franklin Emerging vs. Thrivent Natural Resources | Franklin Emerging vs. Goehring Rozencwajg Resources |
| Saat Market vs. Fznopx | Saat Market vs. Flkypx | Saat Market vs. Fabwx | Saat Market vs. Arrow Managed Futures |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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