Correlation Between Franklin Growth and Jpmorgan
Can any of the company-specific risk be diversified away by investing in both Franklin Growth and Jpmorgan 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 Jpmorgan 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 Jpmorgan Research Equity, you can compare the effects of market volatilities on Franklin Growth and Jpmorgan 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 Jpmorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and Jpmorgan.
Diversification Opportunities for Franklin Growth and Jpmorgan
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Franklin and Jpmorgan is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Growth Opportunities and Jpmorgan Research Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Research Equity 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 Jpmorgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Research Equity has no effect on the direction of Franklin Growth i.e., Franklin Growth and Jpmorgan go up and down completely randomly.
Pair Corralation between Franklin Growth and Jpmorgan
Assuming the 90 days horizon Franklin Growth Opportunities is expected to generate 2.9 times more return on investment than Jpmorgan. However, Franklin Growth is 2.9 times more volatile than Jpmorgan Research Equity. It trades about 0.06 of its potential returns per unit of risk. Jpmorgan Research Equity is currently generating about 0.14 per unit of risk. If you would invest 5,291 in Franklin Growth Opportunities on September 4, 2024 and sell it today you would earn a total of 1,053 from holding Franklin Growth Opportunities or generate 19.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Franklin Growth Opportunities vs. Jpmorgan Research Equity
Performance |
| Timeline |
| Franklin Growth Oppo |
| Jpmorgan Research Equity |
Franklin Growth and Jpmorgan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Growth and Jpmorgan
The main advantage of trading using opposite Franklin Growth and Jpmorgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Growth position performs unexpectedly, Jpmorgan 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 Jpmorgan will offset losses from the drop in Jpmorgan's long position.| Franklin Growth vs. Ab Global Risk | Franklin Growth vs. Artisan Global Unconstrained | Franklin Growth vs. Ab Global Real | Franklin Growth vs. Dreyfusstandish Global Fixed |
| Jpmorgan vs. Mid Cap Growth | Jpmorgan vs. Rational Defensive Growth | Jpmorgan vs. Pace Smallmedium Growth | Jpmorgan vs. Franklin Growth Opportunities |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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