Correlation Between Franklin Wireless and AULT Old
Can any of the company-specific risk be diversified away by investing in both Franklin Wireless and AULT Old 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 Wireless and AULT Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Wireless Corp and AULT Old, you can compare the effects of market volatilities on Franklin Wireless and AULT Old 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 Wireless with a short position of AULT Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Wireless and AULT Old.
Diversification Opportunities for Franklin Wireless and AULT Old
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Franklin and AULT is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Wireless Corp and AULT Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AULT Old and Franklin Wireless 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 Wireless Corp are associated (or correlated) with AULT Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AULT Old has no effect on the direction of Franklin Wireless i.e., Franklin Wireless and AULT Old go up and down completely randomly.
Pair Corralation between Franklin Wireless and AULT Old
Given the investment horizon of 90 days Franklin Wireless Corp is expected to generate 0.39 times more return on investment than AULT Old. However, Franklin Wireless Corp is 2.56 times less risky than AULT Old. It trades about 0.12 of its potential returns per unit of risk. AULT Old is currently generating about -0.08 per unit of risk. If you would invest 362.00 in Franklin Wireless Corp on October 10, 2024 and sell it today you would earn a total of 137.00 from holding Franklin Wireless Corp or generate 37.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 34.4% |
| Values | Daily Returns |
Franklin Wireless Corp vs. AULT Old
Performance |
| Timeline |
| Franklin Wireless Corp |
| AULT Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Franklin Wireless and AULT Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Wireless and AULT Old
The main advantage of trading using opposite Franklin Wireless and AULT Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Wireless position performs unexpectedly, AULT Old 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 AULT Old will offset losses from the drop in AULT Old's long position.| Franklin Wireless vs. Wialan Technologies | Franklin Wireless vs. TPT Global Tech | Franklin Wireless vs. Moving iMage Technologies | Franklin Wireless vs. Comtech Telecommunications Corp |
| AULT Old vs. Genuine Parts Co | AULT Old vs. The Gap, | AULT Old vs. Asbury Automotive Group | AULT Old vs. Catalyst Pharmaceuticals |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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