Correlation Between Franklin High and Oppenheimer Gold
Can any of the company-specific risk be diversified away by investing in both Franklin High and Oppenheimer Gold 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 Oppenheimer Gold 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 Oppenheimer Gold Special, you can compare the effects of market volatilities on Franklin High and Oppenheimer Gold 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 Oppenheimer Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Oppenheimer Gold.
Diversification Opportunities for Franklin High and Oppenheimer Gold
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Franklin and Oppenheimer is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Income and Oppenheimer Gold Special in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Gold Special 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 Oppenheimer Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Gold Special has no effect on the direction of Franklin High i.e., Franklin High and Oppenheimer Gold go up and down completely randomly.
Pair Corralation between Franklin High and Oppenheimer Gold
Assuming the 90 days horizon Franklin High is expected to generate 1.7 times less return on investment than Oppenheimer Gold. But when comparing it to its historical volatility, Franklin High Income is 4.75 times less risky than Oppenheimer Gold. It trades about 0.11 of its potential returns per unit of risk. Oppenheimer Gold Special is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,940 in Oppenheimer Gold Special on August 26, 2024 and sell it today you would earn a total of 615.00 from holding Oppenheimer Gold Special or generate 31.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Income vs. Oppenheimer Gold Special
Performance |
| Timeline |
| Franklin High Income |
| Oppenheimer Gold Special |
Franklin High and Oppenheimer Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Oppenheimer Gold
The main advantage of trading using opposite Franklin High and Oppenheimer Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Oppenheimer Gold 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 Oppenheimer Gold will offset losses from the drop in Oppenheimer Gold'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 |
| Oppenheimer Gold vs. Franklin High Income | Oppenheimer Gold vs. T Rowe Price | Oppenheimer Gold vs. Goldman Sachs High | Oppenheimer Gold 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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