Correlation Between Franklin Equity and Franklin Rising
Can any of the company-specific risk be diversified away by investing in both Franklin Equity and Franklin Rising 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 Equity and Franklin Rising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Equity Income and Franklin Rising Dividends, you can compare the effects of market volatilities on Franklin Equity and Franklin Rising 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 Equity with a short position of Franklin Rising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Equity and Franklin Rising.
Diversification Opportunities for Franklin Equity and Franklin Rising
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Franklin and Franklin is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Equity Income and Franklin Rising Dividends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Rising Dividends and Franklin Equity 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 Equity Income are associated (or correlated) with Franklin Rising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Rising Dividends has no effect on the direction of Franklin Equity i.e., Franklin Equity and Franklin Rising go up and down completely randomly.
Pair Corralation between Franklin Equity and Franklin Rising
Assuming the 90 days horizon Franklin Equity Income is expected to generate 1.11 times more return on investment than Franklin Rising. However, Franklin Equity is 1.11 times more volatile than Franklin Rising Dividends. It trades about 0.34 of its potential returns per unit of risk. Franklin Rising Dividends is currently generating about 0.33 per unit of risk. If you would invest 3,423 in Franklin Equity Income on September 3, 2024 and sell it today you would earn a total of 178.00 from holding Franklin Equity Income or generate 5.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Equity Income vs. Franklin Rising Dividends
Performance |
| Timeline |
| Franklin Equity Income |
| Franklin Rising Dividends |
Franklin Equity and Franklin Rising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Equity and Franklin Rising
The main advantage of trading using opposite Franklin Equity and Franklin Rising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Equity position performs unexpectedly, Franklin Rising 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 Franklin Rising will offset losses from the drop in Franklin Rising's long position.| Franklin Equity vs. Franklin Growth Fund | Franklin Equity vs. Franklin Total Return | Franklin Equity vs. Franklin Rising Dividends | Franklin Equity vs. Franklin Mutual Shares |
| Franklin Rising vs. Franklin Mutual Global | Franklin Rising vs. Franklin Growth Fund | Franklin Rising vs. Franklin Dynatech Fund | Franklin Rising vs. Franklin Strategic Income |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |