Correlation Between Franklin Wireless and Eaco Corp
Can any of the company-specific risk be diversified away by investing in both Franklin Wireless and Eaco Corp 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 Eaco Corp 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 Eaco Corp, you can compare the effects of market volatilities on Franklin Wireless and Eaco Corp 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 Eaco Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Wireless and Eaco Corp.
Diversification Opportunities for Franklin Wireless and Eaco Corp
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Franklin and Eaco is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Wireless Corp and Eaco Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaco Corp 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 Eaco Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaco Corp has no effect on the direction of Franklin Wireless i.e., Franklin Wireless and Eaco Corp go up and down completely randomly.
Pair Corralation between Franklin Wireless and Eaco Corp
Given the investment horizon of 90 days Franklin Wireless is expected to generate 14.73 times less return on investment than Eaco Corp. In addition to that, Franklin Wireless is 1.11 times more volatile than Eaco Corp. It trades about 0.0 of its total potential returns per unit of risk. Eaco Corp is currently generating about 0.07 per unit of volatility. If you would invest 2,875 in Eaco Corp on November 4, 2024 and sell it today you would earn a total of 425.00 from holding Eaco Corp or generate 14.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 22.63% |
| Values | Daily Returns |
Franklin Wireless Corp vs. Eaco Corp
Performance |
| Timeline |
| Franklin Wireless Corp |
| Eaco Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Franklin Wireless and Eaco Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Wireless and Eaco Corp
The main advantage of trading using opposite Franklin Wireless and Eaco Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Wireless position performs unexpectedly, Eaco Corp 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 Eaco Corp will offset losses from the drop in Eaco Corp'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 |
| Eaco Corp vs. Climb Global Solutions | Eaco Corp vs. Insight Enterprises | Eaco Corp vs. ScanSource | Eaco Corp vs. Synnex |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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