Correlation Between Franklin Lifesmart and Ab Global
Can any of the company-specific risk be diversified away by investing in both Franklin Lifesmart and Ab 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 Lifesmart and Ab Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Lifesmart Retirement and Ab Global Real, you can compare the effects of market volatilities on Franklin Lifesmart and Ab 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 Lifesmart with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Lifesmart and Ab Global.
Diversification Opportunities for Franklin Lifesmart and Ab Global
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and AEEIX is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Lifesmart Retirement and Ab Global Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Real and Franklin Lifesmart 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 Lifesmart Retirement are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Real has no effect on the direction of Franklin Lifesmart i.e., Franklin Lifesmart and Ab Global go up and down completely randomly.
Pair Corralation between Franklin Lifesmart and Ab Global
Assuming the 90 days horizon Franklin Lifesmart Retirement is expected to generate 0.37 times more return on investment than Ab Global. However, Franklin Lifesmart Retirement is 2.67 times less risky than Ab Global. It trades about 0.09 of its potential returns per unit of risk. Ab Global Real is currently generating about 0.03 per unit of risk. If you would invest 882.00 in Franklin Lifesmart Retirement on September 19, 2024 and sell it today you would earn a total of 162.00 from holding Franklin Lifesmart Retirement or generate 18.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Lifesmart Retirement vs. Ab Global Real
Performance |
| Timeline |
| Franklin Lifesmart |
| Ab Global Real |
Franklin Lifesmart and Ab Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Lifesmart and Ab Global
The main advantage of trading using opposite Franklin Lifesmart and Ab Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Lifesmart position performs unexpectedly, Ab 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 Ab Global will offset losses from the drop in Ab Global's long position.| Franklin Lifesmart vs. Franklin Mutual Beacon | Franklin Lifesmart vs. Templeton Developing Markets | Franklin Lifesmart vs. Franklin Mutual Global | Franklin Lifesmart vs. Franklin Mutual Global |
| Ab Global vs. Blackrock Moderate Prepared | Ab Global vs. Putnman Retirement Ready | Ab Global vs. Wilmington Trust Retirement | Ab Global vs. Franklin Lifesmart Retirement |
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.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |