Correlation Between Franklin and Nuveen Strategic
Can any of the company-specific risk be diversified away by investing in both Franklin and Nuveen 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 and Nuveen Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Government Money and Nuveen Strategic Municipal, you can compare the effects of market volatilities on Franklin and Nuveen 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 with a short position of Nuveen Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin and Nuveen Strategic.
Diversification Opportunities for Franklin and Nuveen Strategic
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Franklin and Nuveen is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Government Money and Nuveen Strategic Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Strategic Mun and Franklin 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 Government Money are associated (or correlated) with Nuveen Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Strategic Mun has no effect on the direction of Franklin i.e., Franklin and Nuveen Strategic go up and down completely randomly.
Pair Corralation between Franklin and Nuveen Strategic
If you would invest 995.00 in Nuveen Strategic Municipal on November 3, 2024 and sell it today you would earn a total of 4.00 from holding Nuveen Strategic Municipal or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Government Money vs. Nuveen Strategic Municipal
Performance |
| Timeline |
| Franklin Government Money |
| Nuveen Strategic Mun |
Franklin and Nuveen Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin and Nuveen Strategic
The main advantage of trading using opposite Franklin and Nuveen Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin position performs unexpectedly, Nuveen 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 Nuveen Strategic will offset losses from the drop in Nuveen Strategic's long position.| Franklin vs. Gmo High Yield | Franklin vs. Pace High Yield | Franklin vs. Massmutual Premier High | Franklin vs. The Hartford High |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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