Correlation Between Nationwide Global and Franklin Templeton
Can any of the company-specific risk be diversified away by investing in both Nationwide Global and Franklin Templeton 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 Nationwide Global and Franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Global Equity and Franklin Templeton Smacs, you can compare the effects of market volatilities on Nationwide Global and Franklin Templeton 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 Nationwide Global with a short position of Franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Global and Franklin Templeton.
Diversification Opportunities for Nationwide Global and Franklin Templeton
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NATIONWIDE and Franklin is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Global Equity and Franklin Templeton Smacs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Templeton Smacs and Nationwide Global 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 Nationwide Global Equity are associated (or correlated) with Franklin Templeton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Templeton Smacs has no effect on the direction of Nationwide Global i.e., Nationwide Global and Franklin Templeton go up and down completely randomly.
Pair Corralation between Nationwide Global and Franklin Templeton
Assuming the 90 days horizon Nationwide Global Equity is expected to generate 0.67 times more return on investment than Franklin Templeton. However, Nationwide Global Equity is 1.49 times less risky than Franklin Templeton. It trades about 0.27 of its potential returns per unit of risk. Franklin Templeton Smacs is currently generating about -0.15 per unit of risk. If you would invest 2,385 in Nationwide Global Equity on September 3, 2024 and sell it today you would earn a total of 94.00 from holding Nationwide Global Equity or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nationwide Global Equity vs. Franklin Templeton Smacs
Performance |
| Timeline |
| Nationwide Global Equity |
| Franklin Templeton Smacs |
Nationwide Global and Franklin Templeton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Global and Franklin Templeton
The main advantage of trading using opposite Nationwide Global and Franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Global position performs unexpectedly, Franklin Templeton 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 Franklin Templeton will offset losses from the drop in Franklin Templeton's long position.| Nationwide Global vs. Alliancebernstein Global High | Nationwide Global vs. Doubleline Global Bond | Nationwide Global vs. Ab Global Real | Nationwide Global vs. Ab Global Risk |
| Franklin Templeton vs. Nationwide Global Equity | Franklin Templeton vs. Old Westbury Large | Franklin Templeton vs. Artisan Thematic Fund | Franklin Templeton vs. Semiconductor Ultrasector Profund |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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