Correlation Between Franklin Templeton and SGI Enhanced
Can any of the company-specific risk be diversified away by investing in both Franklin Templeton and SGI Enhanced 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 Templeton and SGI Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Templeton ETF and SGI Enhanced Core, you can compare the effects of market volatilities on Franklin Templeton and SGI Enhanced 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 Templeton with a short position of SGI Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Templeton and SGI Enhanced.
Diversification Opportunities for Franklin Templeton and SGI Enhanced
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Franklin and SGI is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Templeton ETF and SGI Enhanced Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGI Enhanced Core and Franklin Templeton 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 Templeton ETF are associated (or correlated) with SGI Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGI Enhanced Core has no effect on the direction of Franklin Templeton i.e., Franklin Templeton and SGI Enhanced go up and down completely randomly.
Pair Corralation between Franklin Templeton and SGI Enhanced
Given the investment horizon of 90 days Franklin Templeton ETF is expected to generate 9.85 times more return on investment than SGI Enhanced. However, Franklin Templeton is 9.85 times more volatile than SGI Enhanced Core. It trades about 0.29 of its potential returns per unit of risk. SGI Enhanced Core is currently generating about 0.75 per unit of risk. If you would invest 2,105 in Franklin Templeton ETF on December 6, 2024 and sell it today you would earn a total of 42.00 from holding Franklin Templeton ETF or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Franklin Templeton ETF vs. SGI Enhanced Core
Performance |
| Timeline |
| Franklin Templeton ETF |
| SGI Enhanced Core |
Franklin Templeton and SGI Enhanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Templeton and SGI Enhanced
The main advantage of trading using opposite Franklin Templeton and SGI Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Templeton position performs unexpectedly, SGI Enhanced 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 SGI Enhanced will offset losses from the drop in SGI Enhanced's long position.| Franklin Templeton vs. Franklin Liberty Investment | Franklin Templeton vs. iShares ESG Aggregate | Franklin Templeton vs. Franklin LibertyQ Equity | Franklin Templeton vs. Franklin Liberty Short |
| SGI Enhanced vs. Strategy Shares | SGI Enhanced vs. Freedom Day Dividend | SGI Enhanced vs. Franklin Templeton ETF | SGI Enhanced vs. iShares MSCI China |
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.
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