Correlation Between Franklin Growth and Icon Financial
Can any of the company-specific risk be diversified away by investing in both Franklin Growth and Icon Financial 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 Growth and Icon Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Growth Opportunities and Icon Financial Fund, you can compare the effects of market volatilities on Franklin Growth and Icon Financial 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 Growth with a short position of Icon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and Icon Financial.
Diversification Opportunities for Franklin Growth and Icon Financial
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and Icon is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Growth Opportunities and Icon Financial Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Financial and Franklin Growth 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 Growth Opportunities are associated (or correlated) with Icon Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Financial has no effect on the direction of Franklin Growth i.e., Franklin Growth and Icon Financial go up and down completely randomly.
Pair Corralation between Franklin Growth and Icon Financial
Assuming the 90 days horizon Franklin Growth Opportunities is expected to generate 1.12 times more return on investment than Icon Financial. However, Franklin Growth is 1.12 times more volatile than Icon Financial Fund. It trades about 0.1 of its potential returns per unit of risk. Icon Financial Fund is currently generating about 0.05 per unit of risk. If you would invest 5,480 in Franklin Growth Opportunities on August 29, 2024 and sell it today you would earn a total of 822.00 from holding Franklin Growth Opportunities or generate 15.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Growth Opportunities vs. Icon Financial Fund
Performance |
| Timeline |
| Franklin Growth Oppo |
| Icon Financial |
Franklin Growth and Icon Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Growth and Icon Financial
The main advantage of trading using opposite Franklin Growth and Icon Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Growth position performs unexpectedly, Icon Financial 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 Icon Financial will offset losses from the drop in Icon Financial's long position.| Franklin Growth vs. Abr 7525 Volatility | Franklin Growth vs. Scharf Global Opportunity | Franklin Growth vs. Arrow Managed Futures | Franklin Growth vs. Aam Select Income |
| Icon Financial vs. HUMANA INC | Icon Financial vs. Aquagold International | Icon Financial vs. Barloworld Ltd ADR | Icon Financial vs. Morningstar Unconstrained Allocation |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |