Correlation Between Ftfa Franklin and Gmo Global
Can any of the company-specific risk be diversified away by investing in both Ftfa Franklin and Gmo 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 Gmo 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 Gmo Global Equity, you can compare the effects of market volatilities on Ftfa Franklin and Gmo 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 Gmo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ftfa Franklin and Gmo Global.
Diversification Opportunities for Ftfa Franklin and Gmo Global
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ftfa and Gmo is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Ftfa Franklin Templeton Growth and Gmo Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Global Equity 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 Gmo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Global Equity has no effect on the direction of Ftfa Franklin i.e., Ftfa Franklin and Gmo Global go up and down completely randomly.
Pair Corralation between Ftfa Franklin and Gmo Global
Assuming the 90 days horizon Ftfa Franklin Templeton Growth is expected to generate 0.48 times more return on investment than Gmo Global. However, Ftfa Franklin Templeton Growth is 2.1 times less risky than Gmo Global. It trades about 0.07 of its potential returns per unit of risk. Gmo Global Equity is currently generating about -0.11 per unit of risk. If you would invest 2,039 in Ftfa Franklin Templeton Growth on October 19, 2024 and sell it today you would earn a total of 17.00 from holding Ftfa Franklin Templeton Growth or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Ftfa Franklin Templeton Growth vs. Gmo Global Equity
Performance |
| Timeline |
| Ftfa Franklin Templeton |
| Gmo Global Equity |
Ftfa Franklin and Gmo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ftfa Franklin and Gmo Global
The main advantage of trading using opposite Ftfa Franklin and Gmo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ftfa Franklin position performs unexpectedly, Gmo 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 Gmo Global will offset losses from the drop in Gmo Global's long position.| Ftfa Franklin vs. Alpine Ultra Short | Ftfa Franklin vs. Access Capital Munity | Ftfa Franklin vs. Gurtin California Muni | Ftfa Franklin vs. Nuveen Strategic Municipal |
| Gmo Global vs. T Rowe Price | Gmo Global vs. Mid Cap Growth | Gmo Global vs. Lifestyle Ii Growth | Gmo Global vs. Ftfa Franklin Templeton 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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