Correlation Between Franklin High and Income Fund
Can any of the company-specific risk be diversified away by investing in both Franklin High and Income Fund 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 Income Fund 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 Income Fund Of, you can compare the effects of market volatilities on Franklin High and Income Fund 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 Income Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Income Fund.
Diversification Opportunities for Franklin High and Income Fund
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Franklin and Income is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Yield and Income Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Income Fund 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 Income Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Income Fund has no effect on the direction of Franklin High i.e., Franklin High and Income Fund go up and down completely randomly.
Pair Corralation between Franklin High and Income Fund
Assuming the 90 days horizon Franklin High Yield is expected to generate 0.41 times more return on investment than Income Fund. However, Franklin High Yield is 2.41 times less risky than Income Fund. It trades about 0.42 of its potential returns per unit of risk. Income Fund Of is currently generating about -0.02 per unit of risk. If you would invest 905.00 in Franklin High Yield on September 12, 2024 and sell it today you would earn a total of 12.00 from holding Franklin High Yield or generate 1.33% 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. Income Fund Of
Performance |
| Timeline |
| Franklin High Yield |
| Income Fund |
Franklin High and Income Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Income Fund
The main advantage of trading using opposite Franklin High and Income Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Income Fund 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 Income Fund will offset losses from the drop in Income Fund's long position.| Franklin High vs. Cref Money Market | Franklin High vs. Chestnut Street Exchange | Franklin High vs. Aig Government Money | Franklin High vs. Matson Money Equity |
| Income Fund vs. Morningstar Municipal Bond | Income Fund vs. Dws Government Money | Income Fund vs. Franklin High Yield | Income Fund vs. Bbh Intermediate Municipal |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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