Correlation Between Franklin FTSE and Axonic Strategic
Can any of the company-specific risk be diversified away by investing in both Franklin FTSE and Axonic Strategic 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 FTSE and Axonic Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin FTSE China and Axonic Strategic Income, you can compare the effects of market volatilities on Franklin FTSE and Axonic Strategic 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 FTSE with a short position of Axonic Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin FTSE and Axonic Strategic.
Diversification Opportunities for Franklin FTSE and Axonic Strategic
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Franklin and Axonic is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Franklin FTSE China and Axonic Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axonic Strategic Income and Franklin FTSE 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 FTSE China are associated (or correlated) with Axonic Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axonic Strategic Income has no effect on the direction of Franklin FTSE i.e., Franklin FTSE and Axonic Strategic go up and down completely randomly.
Pair Corralation between Franklin FTSE and Axonic Strategic
Given the investment horizon of 90 days Franklin FTSE China is expected to under-perform the Axonic Strategic. In addition to that, Franklin FTSE is 12.82 times more volatile than Axonic Strategic Income. It trades about -0.18 of its total potential returns per unit of risk. Axonic Strategic Income is currently generating about 0.07 per unit of volatility. If you would invest 881.00 in Axonic Strategic Income on August 27, 2024 and sell it today you would earn a total of 2.00 from holding Axonic Strategic Income or generate 0.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin FTSE China vs. Axonic Strategic Income
Performance |
| Timeline |
| Franklin FTSE China |
| Axonic Strategic Income |
Franklin FTSE and Axonic Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin FTSE and Axonic Strategic
The main advantage of trading using opposite Franklin FTSE and Axonic Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin FTSE position performs unexpectedly, Axonic Strategic 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 Axonic Strategic will offset losses from the drop in Axonic Strategic's long position.| Franklin FTSE vs. Franklin FTSE South | Franklin FTSE vs. Franklin FTSE Japan | Franklin FTSE vs. Franklin FTSE India | Franklin FTSE vs. Franklin FTSE Brazil |
| Axonic Strategic vs. AB Active ETFs, | Axonic Strategic vs. iShares Core SP | Axonic Strategic vs. Vanguard Momentum Factor | Axonic Strategic vs. Global X Uranium |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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