Correlation Between Franklin High and Rbc Bluebay
Can any of the company-specific risk be diversified away by investing in both Franklin High and Rbc Bluebay 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 Rbc Bluebay 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 Rbc Bluebay Global, you can compare the effects of market volatilities on Franklin High and Rbc Bluebay 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 Rbc Bluebay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Rbc Bluebay.
Diversification Opportunities for Franklin High and Rbc Bluebay
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Rbc is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Yield and Rbc Bluebay Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Bluebay Global 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 Rbc Bluebay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Bluebay Global has no effect on the direction of Franklin High i.e., Franklin High and Rbc Bluebay go up and down completely randomly.
Pair Corralation between Franklin High and Rbc Bluebay
Assuming the 90 days horizon Franklin High Yield is expected to under-perform the Rbc Bluebay. But the mutual fund apears to be less risky and, when comparing its historical volatility, Franklin High Yield is 1.02 times less risky than Rbc Bluebay. The mutual fund trades about -0.38 of its potential returns per unit of risk. The Rbc Bluebay Global is currently generating about -0.21 of returns per unit of risk over similar time horizon. If you would invest 984.00 in Rbc Bluebay Global on October 7, 2024 and sell it today you would lose (12.00) from holding Rbc Bluebay Global or give up 1.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Yield vs. Rbc Bluebay Global
Performance |
| Timeline |
| Franklin High Yield |
| Rbc Bluebay Global |
Franklin High and Rbc Bluebay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Rbc Bluebay
The main advantage of trading using opposite Franklin High and Rbc Bluebay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Rbc Bluebay 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 Rbc Bluebay will offset losses from the drop in Rbc Bluebay's long position.| Franklin High vs. Transamerica Capital Growth | Franklin High vs. Ftfa Franklin Templeton Growth | Franklin High vs. Needham Aggressive Growth | Franklin High vs. Eip Growth And |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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