Correlation Between Franklin and Carillon Scout
Can any of the company-specific risk be diversified away by investing in both Franklin and Carillon Scout 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 and Carillon Scout into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Government Money and Carillon Scout Mid, you can compare the effects of market volatilities on Franklin and Carillon Scout 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 with a short position of Carillon Scout. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin and Carillon Scout.
Diversification Opportunities for Franklin and Carillon Scout
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Carillon is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Government Money and Carillon Scout Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carillon Scout Mid and Franklin 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 Government Money are associated (or correlated) with Carillon Scout. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carillon Scout Mid has no effect on the direction of Franklin i.e., Franklin and Carillon Scout go up and down completely randomly.
Pair Corralation between Franklin and Carillon Scout
If you would invest 2,512 in Carillon Scout Mid on August 31, 2024 and sell it today you would earn a total of 209.00 from holding Carillon Scout Mid or generate 8.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Government Money vs. Carillon Scout Mid
Performance |
| Timeline |
| Franklin Government Money |
| Carillon Scout Mid |
Franklin and Carillon Scout Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin and Carillon Scout
The main advantage of trading using opposite Franklin and Carillon Scout positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin position performs unexpectedly, Carillon Scout 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 Carillon Scout will offset losses from the drop in Carillon Scout's long position.| Franklin vs. Vanguard Total Stock | Franklin vs. Vanguard 500 Index | Franklin vs. Vanguard Total Stock | Franklin vs. Vanguard Total Stock |
| Carillon Scout vs. American Century Investment | Carillon Scout vs. Transamerica Funds | Carillon Scout vs. T Rowe Price | Carillon Scout vs. Franklin Government Money |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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