Correlation Between Franklin Emerging and Virginia Bond
Can any of the company-specific risk be diversified away by investing in both Franklin Emerging and Virginia Bond 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 Virginia Bond 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 Virginia Bond Fund, you can compare the effects of market volatilities on Franklin Emerging and Virginia Bond 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 Virginia Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Emerging and Virginia Bond.
Diversification Opportunities for Franklin Emerging and Virginia Bond
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Franklin and Virginia is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Emerging Market and Virginia Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virginia Bond 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 Virginia Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virginia Bond has no effect on the direction of Franklin Emerging i.e., Franklin Emerging and Virginia Bond go up and down completely randomly.
Pair Corralation between Franklin Emerging and Virginia Bond
Assuming the 90 days horizon Franklin Emerging is expected to generate 2.42 times less return on investment than Virginia Bond. In addition to that, Franklin Emerging is 1.56 times more volatile than Virginia Bond Fund. It trades about 0.15 of its total potential returns per unit of risk. Virginia Bond Fund is currently generating about 0.55 per unit of volatility. If you would invest 1,051 in Virginia Bond Fund on September 12, 2024 and sell it today you would earn a total of 17.00 from holding Virginia Bond Fund or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Emerging Market vs. Virginia Bond Fund
Performance |
| Timeline |
| Franklin Emerging Market |
| Virginia Bond |
Franklin Emerging and Virginia Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Emerging and Virginia Bond
The main advantage of trading using opposite Franklin Emerging and Virginia Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Emerging position performs unexpectedly, Virginia Bond 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 Virginia Bond will offset losses from the drop in Virginia Bond's long position.| Franklin Emerging vs. Rbc Emerging Markets | Franklin Emerging vs. Origin Emerging Markets | Franklin Emerging vs. Siit Emerging Markets | Franklin Emerging vs. Locorr Market Trend |
| Virginia Bond vs. Eagle Mlp Strategy | Virginia Bond vs. Origin Emerging Markets | Virginia Bond vs. Pace International Emerging | Virginia Bond vs. Franklin Emerging Market |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |