Correlation Between Franklin High and Partners Value
Can any of the company-specific risk be diversified away by investing in both Franklin High and Partners Value 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 Partners Value 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 Partners Value Fund, you can compare the effects of market volatilities on Franklin High and Partners Value 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 Partners Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Partners Value.
Diversification Opportunities for Franklin High and Partners Value
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Franklin and Partners is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Income and Partners Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Partners Value 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 Partners Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Partners Value has no effect on the direction of Franklin High i.e., Franklin High and Partners Value go up and down completely randomly.
Pair Corralation between Franklin High and Partners Value
Assuming the 90 days horizon Franklin High Income is expected to generate 0.18 times more return on investment than Partners Value. However, Franklin High Income is 5.41 times less risky than Partners Value. It trades about 0.0 of its potential returns per unit of risk. Partners Value Fund is currently generating about -0.25 per unit of risk. If you would invest 176.00 in Franklin High Income on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Franklin High Income or generate 0.0% 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. Partners Value Fund
Performance |
| Timeline |
| Franklin High Income |
| Partners Value |
Franklin High and Partners Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Partners Value
The main advantage of trading using opposite Franklin High and Partners Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Partners Value 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 Partners Value will offset losses from the drop in Partners Value's long position.| Franklin High vs. Dodge Cox Stock | Franklin High vs. Fm Investments Large | Franklin High vs. T Rowe Price | Franklin High vs. Old Westbury Large |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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