Correlation Between Franklin Small and Calamos Timpani
Can any of the company-specific risk be diversified away by investing in both Franklin Small and Calamos Timpani 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 Small and Calamos Timpani into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Small Cap and Calamos Timpani Smid, you can compare the effects of market volatilities on Franklin Small and Calamos Timpani 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 Small with a short position of Calamos Timpani. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Small and Calamos Timpani.
Diversification Opportunities for Franklin Small and Calamos Timpani
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Franklin and Calamos is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Small Cap and Calamos Timpani Smid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Timpani Smid and Franklin Small 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 Small Cap are associated (or correlated) with Calamos Timpani. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Timpani Smid has no effect on the direction of Franklin Small i.e., Franklin Small and Calamos Timpani go up and down completely randomly.
Pair Corralation between Franklin Small and Calamos Timpani
Assuming the 90 days horizon Franklin Small is expected to generate 1.96 times less return on investment than Calamos Timpani. But when comparing it to its historical volatility, Franklin Small Cap is 1.09 times less risky than Calamos Timpani. It trades about 0.05 of its potential returns per unit of risk. Calamos Timpani Smid is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 944.00 in Calamos Timpani Smid on September 14, 2024 and sell it today you would earn a total of 679.00 from holding Calamos Timpani Smid or generate 71.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
Franklin Small Cap vs. Calamos Timpani Smid
Performance |
| Timeline |
| Franklin Small Cap |
| Calamos Timpani Smid |
Franklin Small and Calamos Timpani Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Small and Calamos Timpani
The main advantage of trading using opposite Franklin Small and Calamos Timpani positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Small position performs unexpectedly, Calamos Timpani 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 Calamos Timpani will offset losses from the drop in Calamos Timpani's long position.| Franklin Small vs. Small Pany Growth | Franklin Small vs. Foundry Partners Fundamental | Franklin Small vs. Ab Small Cap | Franklin Small vs. Guidemark Smallmid Cap |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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