Correlation Between Franklin Growth and 1919 Financial
Can any of the company-specific risk be diversified away by investing in both Franklin Growth and 1919 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 1919 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 1919 Financial Services, you can compare the effects of market volatilities on Franklin Growth and 1919 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 1919 Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and 1919 Financial.
Diversification Opportunities for Franklin Growth and 1919 Financial
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and 1919 is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Growth Opportunities and 1919 Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1919 Financial Services 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 1919 Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1919 Financial Services has no effect on the direction of Franklin Growth i.e., Franklin Growth and 1919 Financial go up and down completely randomly.
Pair Corralation between Franklin Growth and 1919 Financial
Assuming the 90 days horizon Franklin Growth is expected to generate 1.37 times less return on investment than 1919 Financial. In addition to that, Franklin Growth is 1.09 times more volatile than 1919 Financial Services. It trades about 0.1 of its total potential returns per unit of risk. 1919 Financial Services is currently generating about 0.15 per unit of volatility. If you would invest 2,538 in 1919 Financial Services on August 29, 2024 and sell it today you would earn a total of 892.00 from holding 1919 Financial Services or generate 35.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.52% |
| Values | Daily Returns |
Franklin Growth Opportunities vs. 1919 Financial Services
Performance |
| Timeline |
| Franklin Growth Oppo |
| 1919 Financial Services |
Franklin Growth and 1919 Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Growth and 1919 Financial
The main advantage of trading using opposite Franklin Growth and 1919 Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Growth position performs unexpectedly, 1919 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 1919 Financial will offset losses from the drop in 1919 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 |
| 1919 Financial vs. Vanguard Financials Index | 1919 Financial vs. T Rowe Price | 1919 Financial vs. Davis Financial Fund | 1919 Financial vs. HUMANA INC |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |