Correlation Between Franklin Real and Amg Managers
Can any of the company-specific risk be diversified away by investing in both Franklin Real and Amg Managers 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 Real and Amg Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Real Estate and Amg Managers Centersquare, you can compare the effects of market volatilities on Franklin Real and Amg Managers 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 Real with a short position of Amg Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Real and Amg Managers.
Diversification Opportunities for Franklin Real and Amg Managers
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Franklin and Amg is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Real Estate and Amg Managers Centersquare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Managers Centersquare and Franklin Real 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 Real Estate are associated (or correlated) with Amg Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Managers Centersquare has no effect on the direction of Franklin Real i.e., Franklin Real and Amg Managers go up and down completely randomly.
Pair Corralation between Franklin Real and Amg Managers
Assuming the 90 days horizon Franklin Real is expected to generate 1.03 times less return on investment than Amg Managers. In addition to that, Franklin Real is 1.02 times more volatile than Amg Managers Centersquare. It trades about 0.07 of its total potential returns per unit of risk. Amg Managers Centersquare is currently generating about 0.07 per unit of volatility. If you would invest 1,197 in Amg Managers Centersquare on September 3, 2024 and sell it today you would earn a total of 43.00 from holding Amg Managers Centersquare or generate 3.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Real Estate vs. Amg Managers Centersquare
Performance |
| Timeline |
| Franklin Real Estate |
| Amg Managers Centersquare |
Franklin Real and Amg Managers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Real and Amg Managers
The main advantage of trading using opposite Franklin Real and Amg Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Real position performs unexpectedly, Amg Managers 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 Amg Managers will offset losses from the drop in Amg Managers' long position.| Franklin Real vs. Vanguard Reit Index | Franklin Real vs. Vanguard Reit Index | Franklin Real vs. Vanguard Reit Index | Franklin Real vs. Dfa Real Estate |
| Amg Managers vs. Deutsche Health And | Amg Managers vs. Fidelity Advisor Health | Amg Managers vs. Blackrock Health Sciences | Amg Managers vs. Invesco Global 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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