Correlation Between Franklin Lifesmart and Neuberger Berman
Can any of the company-specific risk be diversified away by investing in both Franklin Lifesmart and Neuberger Berman 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 Neuberger Berman 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 Neuberger Berman Real, you can compare the effects of market volatilities on Franklin Lifesmart and Neuberger Berman 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 Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Lifesmart and Neuberger Berman.
Diversification Opportunities for Franklin Lifesmart and Neuberger Berman
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and Neuberger is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Lifesmart Retirement and Neuberger Berman Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman 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 Neuberger Berman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neuberger Berman Real has no effect on the direction of Franklin Lifesmart i.e., Franklin Lifesmart and Neuberger Berman go up and down completely randomly.
Pair Corralation between Franklin Lifesmart and Neuberger Berman
Assuming the 90 days horizon Franklin Lifesmart Retirement is expected to generate 0.35 times more return on investment than Neuberger Berman. However, Franklin Lifesmart Retirement is 2.88 times less risky than Neuberger Berman. It trades about 0.16 of its potential returns per unit of risk. Neuberger Berman Real is currently generating about -0.01 per unit of risk. If you would invest 1,053 in Franklin Lifesmart Retirement on September 15, 2024 and sell it today you would earn a total of 8.00 from holding Franklin Lifesmart Retirement or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Franklin Lifesmart Retirement vs. Neuberger Berman Real
Performance |
| Timeline |
| Franklin Lifesmart |
| Neuberger Berman Real |
Franklin Lifesmart and Neuberger Berman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Lifesmart and Neuberger Berman
The main advantage of trading using opposite Franklin Lifesmart and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Lifesmart position performs unexpectedly, Neuberger Berman 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 Neuberger Berman will offset losses from the drop in Neuberger Berman's long position.| Franklin Lifesmart vs. Jhancock Real Estate | Franklin Lifesmart vs. Vy Clarion Real | Franklin Lifesmart vs. Amg Managers Centersquare | Franklin Lifesmart vs. Simt Real Estate |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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