Correlation Between Ftfa Franklin and Northern Global
Can any of the company-specific risk be diversified away by investing in both Ftfa Franklin and Northern Global 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 Ftfa Franklin and Northern Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ftfa Franklin Templeton Growth and Northern Global Tactical, you can compare the effects of market volatilities on Ftfa Franklin and Northern Global 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 Ftfa Franklin with a short position of Northern Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ftfa Franklin and Northern Global.
Diversification Opportunities for Ftfa Franklin and Northern Global
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ftfa and Northern is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Ftfa Franklin Templeton Growth and Northern Global Tactical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Global Tactical and Ftfa Franklin 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 Ftfa Franklin Templeton Growth are associated (or correlated) with Northern Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Global Tactical has no effect on the direction of Ftfa Franklin i.e., Ftfa Franklin and Northern Global go up and down completely randomly.
Pair Corralation between Ftfa Franklin and Northern Global
Assuming the 90 days horizon Ftfa Franklin Templeton Growth is expected to generate 1.32 times more return on investment than Northern Global. However, Ftfa Franklin is 1.32 times more volatile than Northern Global Tactical. It trades about 0.11 of its potential returns per unit of risk. Northern Global Tactical is currently generating about 0.09 per unit of risk. If you would invest 1,550 in Ftfa Franklin Templeton Growth on September 13, 2024 and sell it today you would earn a total of 582.00 from holding Ftfa Franklin Templeton Growth or generate 37.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ftfa Franklin Templeton Growth vs. Northern Global Tactical
Performance |
| Timeline |
| Ftfa Franklin Templeton |
| Northern Global Tactical |
Ftfa Franklin and Northern Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ftfa Franklin and Northern Global
The main advantage of trading using opposite Ftfa Franklin and Northern Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ftfa Franklin position performs unexpectedly, Northern Global 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 Northern Global will offset losses from the drop in Northern Global's long position.| Ftfa Franklin vs. Lord Abbett Small | Ftfa Franklin vs. Ab Discovery Value | Ftfa Franklin vs. Royce Opportunity Fund | Ftfa Franklin vs. Vanguard Small Cap Value |
| Northern Global vs. Needham Aggressive Growth | Northern Global vs. Ftfa Franklin Templeton Growth | Northern Global vs. L Abbett Growth | Northern Global vs. Pace Smallmedium Growth |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |