Correlation Between Franklin High and Chartwell Small
Can any of the company-specific risk be diversified away by investing in both Franklin High and Chartwell Small 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 Chartwell Small 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 Chartwell Small Cap, you can compare the effects of market volatilities on Franklin High and Chartwell Small 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 Chartwell Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Chartwell Small.
Diversification Opportunities for Franklin High and Chartwell Small
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and Chartwell is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Yield and Chartwell Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chartwell Small Cap 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 Chartwell Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chartwell Small Cap has no effect on the direction of Franklin High i.e., Franklin High and Chartwell Small go up and down completely randomly.
Pair Corralation between Franklin High and Chartwell Small
Assuming the 90 days horizon Franklin High is expected to generate 4.86 times less return on investment than Chartwell Small. But when comparing it to its historical volatility, Franklin High Yield is 4.56 times less risky than Chartwell Small. It trades about 0.23 of its potential returns per unit of risk. Chartwell Small Cap is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 2,102 in Chartwell Small Cap on August 31, 2024 and sell it today you would earn a total of 195.00 from holding Chartwell Small Cap or generate 9.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Yield vs. Chartwell Small Cap
Performance |
| Timeline |
| Franklin High Yield |
| Chartwell Small Cap |
Franklin High and Chartwell Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Chartwell Small
The main advantage of trading using opposite Franklin High and Chartwell Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Chartwell Small 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 Chartwell Small will offset losses from the drop in Chartwell Small's long position.| Franklin High vs. Rbc Global Opportunities | Franklin High vs. Barings Global Floating | Franklin High vs. T Rowe Price | Franklin High vs. T Rowe Price |
| Chartwell Small vs. T Rowe Price | Chartwell Small vs. Ab Impact Municipal | Chartwell Small vs. Franklin High Yield | Chartwell Small vs. Morningstar Municipal Bond |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| 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 | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |