Correlation Between Franklin Growth and Templeton Growth
Can any of the company-specific risk be diversified away by investing in both Franklin Growth 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 Franklin Growth and Templeton Growth 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 Templeton Growth Fund, you can compare the effects of market volatilities on Franklin Growth 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 Franklin Growth with a short position of Templeton Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and Templeton Growth.
Diversification Opportunities for Franklin Growth and Templeton Growth
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Templeton is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Growth Opportunities and Templeton Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Growth 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 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 Franklin Growth i.e., Franklin Growth and Templeton Growth go up and down completely randomly.
Pair Corralation between Franklin Growth and Templeton Growth
Assuming the 90 days horizon Franklin Growth Opportunities is expected to generate 1.64 times more return on investment than Templeton Growth. However, Franklin Growth is 1.64 times more volatile than Templeton Growth Fund. It trades about 0.06 of its potential returns per unit of risk. Templeton Growth Fund is currently generating about 0.05 per unit of risk. If you would invest 4,262 in Franklin Growth Opportunities on October 27, 2024 and sell it today you would earn a total of 1,660 from holding Franklin Growth Opportunities or generate 38.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Growth Opportunities vs. Templeton Growth Fund
Performance |
| Timeline |
| Franklin Growth Oppo |
| Templeton Growth |
Franklin Growth and Templeton Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Growth and Templeton Growth
The main advantage of trading using opposite Franklin Growth and Templeton Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Growth 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.| Franklin Growth vs. Putnman Retirement Ready | Franklin Growth vs. Sierra E Retirement | Franklin Growth vs. Jp Morgan Smartretirement | Franklin Growth vs. Wilmington Trust Retirement |
| Templeton Growth vs. T Rowe Price | Templeton Growth vs. Guidemark Large Cap | Templeton Growth vs. Rational Strategic Allocation | Templeton Growth vs. Oppenheimer Global 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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