Correlation Between Franklin High and Ambrus Core
Can any of the company-specific risk be diversified away by investing in both Franklin High and Ambrus Core 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 Ambrus Core 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 Ambrus Core Bond, you can compare the effects of market volatilities on Franklin High and Ambrus Core 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 Ambrus Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Ambrus Core.
Diversification Opportunities for Franklin High and Ambrus Core
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and Ambrus is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Yield and Ambrus Core Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ambrus Core Bond 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 Ambrus Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ambrus Core Bond has no effect on the direction of Franklin High i.e., Franklin High and Ambrus Core go up and down completely randomly.
Pair Corralation between Franklin High and Ambrus Core
Assuming the 90 days horizon Franklin High is expected to generate 1.36 times less return on investment than Ambrus Core. In addition to that, Franklin High is 1.27 times more volatile than Ambrus Core Bond. It trades about 0.05 of its total potential returns per unit of risk. Ambrus Core Bond is currently generating about 0.09 per unit of volatility. If you would invest 984.00 in Ambrus Core Bond on October 26, 2024 and sell it today you would earn a total of 3.00 from holding Ambrus Core Bond or generate 0.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Yield vs. Ambrus Core Bond
Performance |
| Timeline |
| Franklin High Yield |
| Ambrus Core Bond |
Franklin High and Ambrus Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Ambrus Core
The main advantage of trading using opposite Franklin High and Ambrus Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Ambrus Core 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 Ambrus Core will offset losses from the drop in Ambrus Core's long position.| Franklin High vs. Growth Strategy Fund | Franklin High vs. Ashmore Emerging Markets | Franklin High vs. Commodities Strategy Fund | Franklin High vs. Western Assets Emerging |
| Ambrus Core vs. Upright Assets Allocation | Ambrus Core vs. Alternative Asset Allocation | Ambrus Core vs. Rational Strategic Allocation | Ambrus Core vs. Qs Large Cap |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |