Correlation Between Franklin Templeton and Affiliated Managers
Can any of the company-specific risk be diversified away by investing in both Franklin Templeton and Affiliated Managers 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 Templeton and Affiliated Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Templeton Limited and Affiliated Managers Group, you can compare the effects of market volatilities on Franklin Templeton and Affiliated Managers 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 Templeton with a short position of Affiliated Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Templeton and Affiliated Managers.
Diversification Opportunities for Franklin Templeton and Affiliated Managers
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Franklin and Affiliated is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Templeton Limited and Affiliated Managers Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Affiliated Managers and Franklin Templeton 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 Templeton Limited are associated (or correlated) with Affiliated Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Affiliated Managers has no effect on the direction of Franklin Templeton i.e., Franklin Templeton and Affiliated Managers go up and down completely randomly.
Pair Corralation between Franklin Templeton and Affiliated Managers
Considering the 90-day investment horizon Franklin Templeton Limited is expected to generate 0.4 times more return on investment than Affiliated Managers. However, Franklin Templeton Limited is 2.48 times less risky than Affiliated Managers. It trades about 0.08 of its potential returns per unit of risk. Affiliated Managers Group is currently generating about 0.03 per unit of risk. If you would invest 509.00 in Franklin Templeton Limited on August 27, 2024 and sell it today you would earn a total of 151.00 from holding Franklin Templeton Limited or generate 29.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Templeton Limited vs. Affiliated Managers Group
Performance |
| Timeline |
| Franklin Templeton |
| Affiliated Managers |
Franklin Templeton and Affiliated Managers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Templeton and Affiliated Managers
The main advantage of trading using opposite Franklin Templeton and Affiliated Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Templeton position performs unexpectedly, Affiliated Managers 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 Affiliated Managers will offset losses from the drop in Affiliated Managers' long position.| Franklin Templeton vs. MFS Investment Grade | Franklin Templeton vs. Invesco High Income | Franklin Templeton vs. Eaton Vance National | Franklin Templeton vs. Rivernorth Opportunistic Municipalome |
| Affiliated Managers vs. Brightsphere Investment Group | Affiliated Managers vs. Franklin Templeton Limited | Affiliated Managers vs. Blackrock Muni Intermediate | Affiliated Managers vs. Munivest Fund |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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