Correlation Between Franklin Lifesmart and Tiaa-cref Emerging
Can any of the company-specific risk be diversified away by investing in both Franklin Lifesmart and Tiaa-cref Emerging 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 Lifesmart and Tiaa-cref Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Lifesmart 2050 and Tiaa Cref Emerging Markets, you can compare the effects of market volatilities on Franklin Lifesmart and Tiaa-cref Emerging 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 Lifesmart with a short position of Tiaa-cref Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Lifesmart and Tiaa-cref Emerging.
Diversification Opportunities for Franklin Lifesmart and Tiaa-cref Emerging
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FRANKLIN and Tiaa-cref is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Lifesmart 2050 and Tiaa Cref Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Emerging and Franklin Lifesmart 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 Lifesmart 2050 are associated (or correlated) with Tiaa-cref Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Emerging has no effect on the direction of Franklin Lifesmart i.e., Franklin Lifesmart and Tiaa-cref Emerging go up and down completely randomly.
Pair Corralation between Franklin Lifesmart and Tiaa-cref Emerging
Assuming the 90 days horizon Franklin Lifesmart 2050 is expected to generate 0.68 times more return on investment than Tiaa-cref Emerging. However, Franklin Lifesmart 2050 is 1.47 times less risky than Tiaa-cref Emerging. It trades about 0.29 of its potential returns per unit of risk. Tiaa Cref Emerging Markets is currently generating about -0.18 per unit of risk. If you would invest 1,559 in Franklin Lifesmart 2050 on September 4, 2024 and sell it today you would earn a total of 54.00 from holding Franklin Lifesmart 2050 or generate 3.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Lifesmart 2050 vs. Tiaa Cref Emerging Markets
Performance |
| Timeline |
| Franklin Lifesmart 2050 |
| Tiaa Cref Emerging |
Franklin Lifesmart and Tiaa-cref Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Lifesmart and Tiaa-cref Emerging
The main advantage of trading using opposite Franklin Lifesmart and Tiaa-cref Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Lifesmart position performs unexpectedly, Tiaa-cref Emerging 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 Tiaa-cref Emerging will offset losses from the drop in Tiaa-cref Emerging's long position.| Franklin Lifesmart vs. Franklin Mutual Beacon | Franklin Lifesmart vs. Templeton Developing Markets | Franklin Lifesmart vs. Franklin Mutual Global | Franklin Lifesmart vs. Franklin Mutual Global |
| Tiaa-cref Emerging vs. Tiaa Cref Emerging Markets | Tiaa-cref Emerging vs. Tiaa Cref Emerging Markets | Tiaa-cref Emerging vs. Tiaa Cref Emerging Markets | Tiaa-cref Emerging vs. Tiaa Cref Emerging Markets |
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.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |