Correlation Between Franklin Natural and Calvert Global
Can any of the company-specific risk be diversified away by investing in both Franklin Natural and Calvert Global 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 Natural and Calvert Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Natural Resources and Calvert Global Energy, you can compare the effects of market volatilities on Franklin Natural and Calvert Global 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 Natural with a short position of Calvert Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Natural and Calvert Global.
Diversification Opportunities for Franklin Natural and Calvert Global
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and Calvert is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Natural Resources and Calvert Global Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Global Energy and Franklin Natural 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 Natural Resources are associated (or correlated) with Calvert Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Global Energy has no effect on the direction of Franklin Natural i.e., Franklin Natural and Calvert Global go up and down completely randomly.
Pair Corralation between Franklin Natural and Calvert Global
Assuming the 90 days horizon Franklin Natural Resources is expected to generate 0.85 times more return on investment than Calvert Global. However, Franklin Natural Resources is 1.18 times less risky than Calvert Global. It trades about 0.22 of its potential returns per unit of risk. Calvert Global Energy is currently generating about -0.02 per unit of risk. If you would invest 3,041 in Franklin Natural Resources on September 1, 2024 and sell it today you would earn a total of 118.00 from holding Franklin Natural Resources or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Natural Resources vs. Calvert Global Energy
Performance |
| Timeline |
| Franklin Natural Res |
| Calvert Global Energy |
Franklin Natural and Calvert Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Natural and Calvert Global
The main advantage of trading using opposite Franklin Natural and Calvert Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Natural position performs unexpectedly, Calvert Global 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 Calvert Global will offset losses from the drop in Calvert Global's long position.| Franklin Natural vs. Lord Abbett Small | Franklin Natural vs. Great West Loomis Sayles | Franklin Natural vs. Amg River Road | Franklin Natural vs. Heartland Value Plus |
| Calvert Global vs. Franklin Government Money | Calvert Global vs. Dws Government Money | Calvert Global vs. Dunham Porategovernment Bond | Calvert Global vs. Franklin Adjustable Government |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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