Correlation Between Franklin Templeton and Nuveen Floating
Can any of the company-specific risk be diversified away by investing in both Franklin Templeton and Nuveen Floating 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 Nuveen Floating 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 Nuveen Floating Rate, you can compare the effects of market volatilities on Franklin Templeton and Nuveen Floating 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 Nuveen Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Templeton and Nuveen Floating.
Diversification Opportunities for Franklin Templeton and Nuveen Floating
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Franklin and Nuveen is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Templeton Limited and Nuveen Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Floating Rate 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 Nuveen Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Floating Rate has no effect on the direction of Franklin Templeton i.e., Franklin Templeton and Nuveen Floating go up and down completely randomly.
Pair Corralation between Franklin Templeton and Nuveen Floating
Considering the 90-day investment horizon Franklin Templeton is expected to generate 2.01 times less return on investment than Nuveen Floating. But when comparing it to its historical volatility, Franklin Templeton Limited is 1.03 times less risky than Nuveen Floating. It trades about 0.2 of its potential returns per unit of risk. Nuveen Floating Rate is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 876.00 in Nuveen Floating Rate on September 1, 2024 and sell it today you would earn a total of 36.00 from holding Nuveen Floating Rate or generate 4.11% 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. Nuveen Floating Rate
Performance |
| Timeline |
| Franklin Templeton |
| Nuveen Floating Rate |
Franklin Templeton and Nuveen Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Templeton and Nuveen Floating
The main advantage of trading using opposite Franklin Templeton and Nuveen Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Templeton position performs unexpectedly, Nuveen Floating 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 Nuveen Floating will offset losses from the drop in Nuveen Floating's 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 |
| Nuveen Floating vs. Pioneer Floating Rate | Nuveen Floating vs. BlackRock Floating Rate | Nuveen Floating vs. Blackrock Muni Intermediate | Nuveen Floating vs. Eaton Vance Senior |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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