Correlation Between Franklin Total and Clearbridge Value
Can any of the company-specific risk be diversified away by investing in both Franklin Total and Clearbridge Value 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 Total and Clearbridge Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Total Return and Clearbridge Value Trust, you can compare the effects of market volatilities on Franklin Total and Clearbridge Value 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 Total with a short position of Clearbridge Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Total and Clearbridge Value.
Diversification Opportunities for Franklin Total and Clearbridge Value
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Franklin and Clearbridge is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Total Return and Clearbridge Value Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Value Trust and Franklin Total 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 Total Return are associated (or correlated) with Clearbridge Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Value Trust has no effect on the direction of Franklin Total i.e., Franklin Total and Clearbridge Value go up and down completely randomly.
Pair Corralation between Franklin Total and Clearbridge Value
Assuming the 90 days horizon Franklin Total is expected to generate 6.1 times less return on investment than Clearbridge Value. But when comparing it to its historical volatility, Franklin Total Return is 2.64 times less risky than Clearbridge Value. It trades about 0.09 of its potential returns per unit of risk. Clearbridge Value Trust is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 10,657 in Clearbridge Value Trust on August 28, 2024 and sell it today you would earn a total of 479.00 from holding Clearbridge Value Trust or generate 4.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Total Return vs. Clearbridge Value Trust
Performance |
| Timeline |
| Franklin Total Return |
| Clearbridge Value Trust |
Franklin Total and Clearbridge Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Total and Clearbridge Value
The main advantage of trading using opposite Franklin Total and Clearbridge Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Total position performs unexpectedly, Clearbridge Value 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 Clearbridge Value will offset losses from the drop in Clearbridge Value's long position.| Franklin Total vs. Franklin Mutual Beacon | Franklin Total vs. Templeton Developing Markets | Franklin Total vs. Franklin Mutual Global | Franklin Total vs. Franklin Mutual Global |
| Clearbridge Value vs. Franklin Growth Fund | Clearbridge Value vs. Franklin Total Return | Clearbridge Value vs. Franklin Rising Dividends | Clearbridge Value 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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