Correlation Between Forum Real and Templeton Growth
Can any of the company-specific risk be diversified away by investing in both Forum Real and Templeton Growth 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 Forum Real and Templeton Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forum Real Estate and Templeton Growth Fund, you can compare the effects of market volatilities on Forum Real and Templeton Growth 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 Forum Real with a short position of Templeton Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forum Real and Templeton Growth.
Diversification Opportunities for Forum Real and Templeton Growth
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Forum and Templeton is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Forum Real Estate and Templeton Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Growth and Forum Real 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 Forum Real Estate are associated (or correlated) with Templeton Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Growth has no effect on the direction of Forum Real i.e., Forum Real and Templeton Growth go up and down completely randomly.
Pair Corralation between Forum Real and Templeton Growth
Assuming the 90 days horizon Forum Real is expected to generate 4.67 times less return on investment than Templeton Growth. But when comparing it to its historical volatility, Forum Real Estate is 4.43 times less risky than Templeton Growth. It trades about 0.07 of its potential returns per unit of risk. Templeton Growth Fund is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,680 in Templeton Growth Fund on November 5, 2024 and sell it today you would earn a total of 25.00 from holding Templeton Growth Fund or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forum Real Estate vs. Templeton Growth Fund
Performance |
| Timeline |
| Forum Real Estate |
| Templeton Growth |
Forum Real and Templeton Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forum Real and Templeton Growth
The main advantage of trading using opposite Forum Real and Templeton Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forum Real position performs unexpectedly, Templeton Growth 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 Templeton Growth will offset losses from the drop in Templeton Growth's long position.| Forum Real vs. Davis Financial Fund | Forum Real vs. Rmb Mendon Financial | Forum Real vs. Cref Money Market | Forum Real vs. Franklin Government Money |
| Templeton Growth vs. Icon Natural Resources | Templeton Growth vs. Oil Gas Ultrasector | Templeton Growth vs. Energy Services Fund | Templeton Growth vs. Hennessy Bp Energy |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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