Correlation Between Franklin High and Invesco Floating
Can any of the company-specific risk be diversified away by investing in both Franklin High and Invesco Floating 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 Invesco Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin High Yield and Invesco Floating Rate, you can compare the effects of market volatilities on Franklin High and Invesco Floating 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 Invesco Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Invesco Floating.
Diversification Opportunities for Franklin High and Invesco Floating
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Franklin and Invesco is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Yield and Invesco Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Floating Rate 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 Yield are associated (or correlated) with Invesco Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Floating Rate has no effect on the direction of Franklin High i.e., Franklin High and Invesco Floating go up and down completely randomly.
Pair Corralation between Franklin High and Invesco Floating
Assuming the 90 days horizon Franklin High is expected to generate 2.42 times less return on investment than Invesco Floating. In addition to that, Franklin High is 1.45 times more volatile than Invesco Floating Rate. It trades about 0.05 of its total potential returns per unit of risk. Invesco Floating Rate is currently generating about 0.17 per unit of volatility. If you would invest 565.00 in Invesco Floating Rate on October 18, 2024 and sell it today you would earn a total of 103.00 from holding Invesco Floating Rate or generate 18.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Yield vs. Invesco Floating Rate
Performance |
| Timeline |
| Franklin High Yield |
| Invesco Floating Rate |
Franklin High and Invesco Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Invesco Floating
The main advantage of trading using opposite Franklin High and Invesco Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Invesco Floating 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 Invesco Floating will offset losses from the drop in Invesco Floating's long position.| Franklin High vs. Altegris Futures Evolution | Franklin High vs. Credit Suisse Multialternative | Franklin High vs. Tiaa Cref Inflation Linked Bond | Franklin High vs. Guidepath Managed Futures |
| Invesco Floating vs. Dreyfusstandish Global Fixed | Invesco Floating vs. Franklin High Yield | Invesco Floating vs. Blrc Sgy Mnp | Invesco Floating vs. Multisector Bond Sma |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |