Correlation Between Franklin Adjustable and Mfs Research
Can any of the company-specific risk be diversified away by investing in both Franklin Adjustable and Mfs Research 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 Mfs Research 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 Mfs Research Fund, you can compare the effects of market volatilities on Franklin Adjustable and Mfs Research 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 Mfs Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Adjustable and Mfs Research.
Diversification Opportunities for Franklin Adjustable and Mfs Research
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between FRANKLIN and Mfs is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Adjustable Government and Mfs Research Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Research 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 Mfs Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Research has no effect on the direction of Franklin Adjustable i.e., Franklin Adjustable and Mfs Research go up and down completely randomly.
Pair Corralation between Franklin Adjustable and Mfs Research
Assuming the 90 days horizon Franklin Adjustable is expected to generate 4.39 times less return on investment than Mfs Research. But when comparing it to its historical volatility, Franklin Adjustable Government is 6.43 times less risky than Mfs Research. It trades about 0.17 of its potential returns per unit of risk. Mfs Research Fund is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 4,949 in Mfs Research Fund on September 2, 2024 and sell it today you would earn a total of 1,839 from holding Mfs Research Fund or generate 37.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Adjustable Government vs. Mfs Research Fund
Performance |
| Timeline |
| Franklin Adjustable |
| Mfs Research |
Franklin Adjustable and Mfs Research Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Adjustable and Mfs Research
The main advantage of trading using opposite Franklin Adjustable and Mfs Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Adjustable position performs unexpectedly, Mfs Research 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 Mfs Research will offset losses from the drop in Mfs Research's long position.| Franklin Adjustable vs. Nationwide Growth Fund | Franklin Adjustable vs. Touchstone Small Cap | Franklin Adjustable vs. Qs Growth Fund | Franklin Adjustable vs. Eip Growth And |
| Mfs Research vs. Mfs Prudent Investor | Mfs Research vs. Mfs Prudent Investor | Mfs Research vs. Mfs Prudent Investor | Mfs Research vs. Mfs Prudent Investor |
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.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |