Correlation Between Franklin Adjustable and Mainstay High
Can any of the company-specific risk be diversified away by investing in both Franklin Adjustable and Mainstay High 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 Adjustable and Mainstay High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Adjustable Government and Mainstay High Yield, you can compare the effects of market volatilities on Franklin Adjustable and Mainstay High 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 Adjustable with a short position of Mainstay High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Adjustable and Mainstay High.
Diversification Opportunities for Franklin Adjustable and Mainstay High
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and Mainstay is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Adjustable Government and Mainstay High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay High Yield and Franklin Adjustable 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 Adjustable Government are associated (or correlated) with Mainstay High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay High Yield has no effect on the direction of Franklin Adjustable i.e., Franklin Adjustable and Mainstay High go up and down completely randomly.
Pair Corralation between Franklin Adjustable and Mainstay High
Assuming the 90 days horizon Franklin Adjustable is expected to generate 1.82 times less return on investment than Mainstay High. But when comparing it to its historical volatility, Franklin Adjustable Government is 1.6 times less risky than Mainstay High. It trades about 0.18 of its potential returns per unit of risk. Mainstay High Yield is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 474.00 in Mainstay High Yield on September 15, 2024 and sell it today you would earn a total of 51.00 from holding Mainstay High Yield or generate 10.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
Franklin Adjustable Government vs. Mainstay High Yield
Performance |
| Timeline |
| Franklin Adjustable |
| Mainstay High Yield |
Franklin Adjustable and Mainstay High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Adjustable and Mainstay High
The main advantage of trading using opposite Franklin Adjustable and Mainstay High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Adjustable position performs unexpectedly, Mainstay High 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 Mainstay High will offset losses from the drop in Mainstay High's long position.| Franklin Adjustable vs. Franklin Mutual Beacon | Franklin Adjustable vs. Templeton Developing Markets | Franklin Adjustable vs. Franklin Mutual Global | Franklin Adjustable vs. Franklin Mutual Global |
| Mainstay High vs. Franklin Adjustable Government | Mainstay High vs. Goldman Sachs Government | Mainstay High vs. Sit Government Securities | Mainstay High vs. Lord Abbett Government |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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