Correlation Between Franklin and Deutsche Global
Can any of the company-specific risk be diversified away by investing in both Franklin and Deutsche 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 and Deutsche Global 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 Deutsche Global Income, you can compare the effects of market volatilities on Franklin and Deutsche 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 with a short position of Deutsche Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin and Deutsche Global.
Diversification Opportunities for Franklin and Deutsche Global
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Franklin and DEUTSCHE is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Government Money and Deutsche Global Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Global Income 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 Deutsche Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Global Income has no effect on the direction of Franklin i.e., Franklin and Deutsche Global go up and down completely randomly.
Pair Corralation between Franklin and Deutsche Global
Assuming the 90 days horizon Franklin is expected to generate 2.75 times less return on investment than Deutsche Global. But when comparing it to its historical volatility, Franklin Government Money is 3.83 times less risky than Deutsche Global. It trades about 0.13 of its potential returns per unit of risk. Deutsche Global Income is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 815.00 in Deutsche Global Income on September 1, 2024 and sell it today you would earn a total of 205.00 from holding Deutsche Global Income or generate 25.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Franklin Government Money vs. Deutsche Global Income
Performance |
| Timeline |
| Franklin Government Money |
| Deutsche Global Income |
Franklin and Deutsche Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin and Deutsche Global
The main advantage of trading using opposite Franklin and Deutsche Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin position performs unexpectedly, Deutsche 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 Deutsche Global will offset losses from the drop in Deutsche Global's long position.| Franklin vs. Touchstone Small Cap | Franklin vs. Chase Growth Fund | Franklin vs. Champlain Mid Cap | Franklin vs. Rational Defensive Growth |
| Deutsche Global vs. Prudential Government Money | Deutsche Global vs. Franklin Government Money | Deutsche Global vs. Bbh Trust | Deutsche Global vs. Dws 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |