Correlation Between Franklin Gold and Northern Funds
Can any of the company-specific risk be diversified away by investing in both Franklin Gold and Northern Funds 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 Gold and Northern Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Gold Precious and Northern Funds , you can compare the effects of market volatilities on Franklin Gold and Northern Funds 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 Gold with a short position of Northern Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Gold and Northern Funds.
Diversification Opportunities for Franklin Gold and Northern Funds
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Franklin and Northern is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Gold Precious and Northern Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Funds and Franklin Gold 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 Gold Precious are associated (or correlated) with Northern Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Funds has no effect on the direction of Franklin Gold i.e., Franklin Gold and Northern Funds go up and down completely randomly.
Pair Corralation between Franklin Gold and Northern Funds
If you would invest 1,777 in Franklin Gold Precious on September 13, 2024 and sell it today you would earn a total of 141.00 from holding Franklin Gold Precious or generate 7.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Franklin Gold Precious vs. Northern Funds
Performance |
| Timeline |
| Franklin Gold Precious |
| Northern Funds |
Franklin Gold and Northern Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Gold and Northern Funds
The main advantage of trading using opposite Franklin Gold and Northern Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Gold position performs unexpectedly, Northern Funds 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 Northern Funds will offset losses from the drop in Northern Funds' long position.| Franklin Gold vs. Franklin Mutual Beacon | Franklin Gold vs. Templeton Developing Markets | Franklin Gold vs. Franklin Mutual Global | Franklin Gold vs. Franklin Mutual Global |
| Northern Funds vs. The Gabelli Healthcare | Northern Funds vs. Highland Longshort Healthcare | Northern Funds vs. Invesco Global Health | Northern Funds vs. Live Oak Health |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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