Correlation Between Franklin High and Artisan Emerging
Can any of the company-specific risk be diversified away by investing in both Franklin High and Artisan Emerging 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 High and Artisan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin High Income and Artisan Emerging Markets, you can compare the effects of market volatilities on Franklin High and Artisan Emerging 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 High with a short position of Artisan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Artisan Emerging.
Diversification Opportunities for Franklin High and Artisan Emerging
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and Artisan is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Income and Artisan Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Emerging Markets and Franklin High 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 High Income are associated (or correlated) with Artisan Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Emerging Markets has no effect on the direction of Franklin High i.e., Franklin High and Artisan Emerging go up and down completely randomly.
Pair Corralation between Franklin High and Artisan Emerging
Assuming the 90 days horizon Franklin High Income is expected to generate 1.19 times more return on investment than Artisan Emerging. However, Franklin High is 1.19 times more volatile than Artisan Emerging Markets. It trades about 0.16 of its potential returns per unit of risk. Artisan Emerging Markets is currently generating about 0.16 per unit of risk. If you would invest 168.00 in Franklin High Income on August 26, 2024 and sell it today you would earn a total of 8.00 from holding Franklin High Income or generate 4.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Income vs. Artisan Emerging Markets
Performance |
| Timeline |
| Franklin High Income |
| Artisan Emerging Markets |
Franklin High and Artisan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Artisan Emerging
The main advantage of trading using opposite Franklin High and Artisan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Artisan Emerging 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 Artisan Emerging will offset losses from the drop in Artisan Emerging's long position.| Franklin High vs. Franklin Mutual Beacon | Franklin High vs. Templeton Developing Markets | Franklin High vs. Franklin Mutual Global | Franklin High vs. Franklin Mutual Global |
| Artisan Emerging vs. Morningstar Aggressive Growth | Artisan Emerging vs. Franklin High Income | Artisan Emerging vs. Pace High Yield | Artisan Emerging vs. Alliancebernstein Global High |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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