Correlation Between Franklin LibertyQ and Franklin FTSE
Can any of the company-specific risk be diversified away by investing in both Franklin LibertyQ and Franklin FTSE 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 LibertyQ and Franklin FTSE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin LibertyQ Global and Franklin FTSE Brazil, you can compare the effects of market volatilities on Franklin LibertyQ and Franklin FTSE 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 LibertyQ with a short position of Franklin FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin LibertyQ and Franklin FTSE.
Diversification Opportunities for Franklin LibertyQ and Franklin FTSE
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Franklin and Franklin is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Franklin LibertyQ Global and Franklin FTSE Brazil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin FTSE Brazil and Franklin LibertyQ 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 LibertyQ Global are associated (or correlated) with Franklin FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin FTSE Brazil has no effect on the direction of Franklin LibertyQ i.e., Franklin LibertyQ and Franklin FTSE go up and down completely randomly.
Pair Corralation between Franklin LibertyQ and Franklin FTSE
Assuming the 90 days trading horizon Franklin LibertyQ Global is expected to generate 4.26 times more return on investment than Franklin FTSE. However, Franklin LibertyQ is 4.26 times more volatile than Franklin FTSE Brazil. It trades about 0.07 of its potential returns per unit of risk. Franklin FTSE Brazil is currently generating about 0.01 per unit of risk. If you would invest 684.00 in Franklin LibertyQ Global on August 31, 2024 and sell it today you would earn a total of 2,230 from holding Franklin LibertyQ Global or generate 326.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin LibertyQ Global vs. Franklin FTSE Brazil
Performance |
| Timeline |
| Franklin LibertyQ Global |
| Franklin FTSE Brazil |
Franklin LibertyQ and Franklin FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin LibertyQ and Franklin FTSE
The main advantage of trading using opposite Franklin LibertyQ and Franklin FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin LibertyQ position performs unexpectedly, Franklin FTSE 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 Franklin FTSE will offset losses from the drop in Franklin FTSE's long position.| Franklin LibertyQ vs. Leverage Shares 3x | Franklin LibertyQ vs. WisdomTree Natural Gas | Franklin LibertyQ vs. GraniteShares 3x Short | Franklin LibertyQ vs. Leverage Shares 3x |
| Franklin FTSE vs. Franklin LibertyQ Global | Franklin FTSE vs. Franklin Libertyshares ICAV | Franklin FTSE vs. Franklin FTSE Asia | Franklin FTSE vs. Franklin FTSE Brazil |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |