Correlation Between Franklin Growth and Templeton Foreign
Can any of the company-specific risk be diversified away by investing in both Franklin Growth and Templeton Foreign 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 Growth and Templeton Foreign into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Growth Allocation and Templeton Foreign Fund, you can compare the effects of market volatilities on Franklin Growth and Templeton Foreign 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 Growth with a short position of Templeton Foreign. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and Templeton Foreign.
Diversification Opportunities for Franklin Growth and Templeton Foreign
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Franklin and Templeton is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Growth Allocation and Templeton Foreign Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Foreign and Franklin Growth 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 Growth Allocation are associated (or correlated) with Templeton Foreign. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Foreign has no effect on the direction of Franklin Growth i.e., Franklin Growth and Templeton Foreign go up and down completely randomly.
Pair Corralation between Franklin Growth and Templeton Foreign
Assuming the 90 days horizon Franklin Growth Allocation is expected to generate 0.54 times more return on investment than Templeton Foreign. However, Franklin Growth Allocation is 1.86 times less risky than Templeton Foreign. It trades about 0.05 of its potential returns per unit of risk. Templeton Foreign Fund is currently generating about -0.13 per unit of risk. If you would invest 1,989 in Franklin Growth Allocation on September 13, 2024 and sell it today you would earn a total of 18.00 from holding Franklin Growth Allocation or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Growth Allocation vs. Templeton Foreign Fund
Performance |
| Timeline |
| Franklin Growth Allo |
| Templeton Foreign |
Franklin Growth and Templeton Foreign Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Growth and Templeton Foreign
The main advantage of trading using opposite Franklin Growth and Templeton Foreign positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Growth position performs unexpectedly, Templeton Foreign 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 Templeton Foreign will offset losses from the drop in Templeton Foreign's long position.| Franklin Growth vs. Franklin Mutual Beacon | Franklin Growth vs. Templeton Developing Markets | Franklin Growth vs. Franklin Mutual Global | Franklin Growth vs. Franklin Mutual Global |
| Templeton Foreign vs. Us High Relative | Templeton Foreign vs. Artisan High Income | Templeton Foreign vs. Western Asset High | Templeton Foreign vs. Siit High Yield |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |