Correlation Between Franklin and Natixis Oakmark
Can any of the company-specific risk be diversified away by investing in both Franklin and Natixis Oakmark 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 Natixis Oakmark 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 Natixis Oakmark, you can compare the effects of market volatilities on Franklin and Natixis Oakmark 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 Natixis Oakmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin and Natixis Oakmark.
Diversification Opportunities for Franklin and Natixis Oakmark
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Natixis is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Government Money and Natixis Oakmark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis Oakmark 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 Natixis Oakmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis Oakmark has no effect on the direction of Franklin i.e., Franklin and Natixis Oakmark go up and down completely randomly.
Pair Corralation between Franklin and Natixis Oakmark
Assuming the 90 days horizon Franklin is expected to generate 8.02 times less return on investment than Natixis Oakmark. But when comparing it to its historical volatility, Franklin Government Money is 6.9 times less risky than Natixis Oakmark. It trades about 0.13 of its potential returns per unit of risk. Natixis Oakmark is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 3,097 in Natixis Oakmark on September 2, 2024 and sell it today you would earn a total of 529.00 from holding Natixis Oakmark or generate 17.08% 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. Natixis Oakmark
Performance |
| Timeline |
| Franklin Government Money |
| Natixis Oakmark |
Franklin and Natixis Oakmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin and Natixis Oakmark
The main advantage of trading using opposite Franklin and Natixis Oakmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin position performs unexpectedly, Natixis Oakmark 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 Natixis Oakmark will offset losses from the drop in Natixis Oakmark's long position.| Franklin vs. Vanguard Total Stock | Franklin vs. Vanguard 500 Index | Franklin vs. Vanguard Total Stock | Franklin vs. Vanguard Total Stock |
| Natixis Oakmark vs. Touchstone Large Cap | Natixis Oakmark vs. Qs Large Cap | Natixis Oakmark vs. Legg Mason Bw | Natixis Oakmark vs. T Rowe Price |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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