Correlation Between Franklin Adjustable and Altegris/aaca Opportunistic
Can any of the company-specific risk be diversified away by investing in both Franklin Adjustable and Altegris/aaca Opportunistic 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 Altegris/aaca Opportunistic 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 Altegrisaaca Opportunistic Real, you can compare the effects of market volatilities on Franklin Adjustable and Altegris/aaca Opportunistic 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 Altegris/aaca Opportunistic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Adjustable and Altegris/aaca Opportunistic.
Diversification Opportunities for Franklin Adjustable and Altegris/aaca Opportunistic
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Franklin and Altegris/aaca is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Adjustable Government and Altegrisaaca Opportunistic Rea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altegris/aaca Opportunistic 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 Altegris/aaca Opportunistic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altegris/aaca Opportunistic has no effect on the direction of Franklin Adjustable i.e., Franklin Adjustable and Altegris/aaca Opportunistic go up and down completely randomly.
Pair Corralation between Franklin Adjustable and Altegris/aaca Opportunistic
Assuming the 90 days horizon Franklin Adjustable is expected to generate 1.83 times less return on investment than Altegris/aaca Opportunistic. But when comparing it to its historical volatility, Franklin Adjustable Government is 10.95 times less risky than Altegris/aaca Opportunistic. It trades about 0.14 of its potential returns per unit of risk. Altegrisaaca Opportunistic Real is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,177 in Altegrisaaca Opportunistic Real on September 5, 2024 and sell it today you would earn a total of 136.00 from holding Altegrisaaca Opportunistic Real or generate 11.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Franklin Adjustable Government vs. Altegrisaaca Opportunistic Rea
Performance |
| Timeline |
| Franklin Adjustable |
| Altegris/aaca Opportunistic |
Franklin Adjustable and Altegris/aaca Opportunistic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Adjustable and Altegris/aaca Opportunistic
The main advantage of trading using opposite Franklin Adjustable and Altegris/aaca Opportunistic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Adjustable position performs unexpectedly, Altegris/aaca Opportunistic 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 Altegris/aaca Opportunistic will offset losses from the drop in Altegris/aaca Opportunistic'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 |
| Altegris/aaca Opportunistic vs. Guggenheim Risk Managed | Altegris/aaca Opportunistic vs. Real Estate Fund | Altegris/aaca Opportunistic vs. Guggenheim Risk Managed |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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