Correlation Between Goldman Sachs and Ftfa Franklin
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Ftfa Franklin 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 Goldman Sachs and Ftfa Franklin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Growth and Ftfa Franklin Templeton Growth, you can compare the effects of market volatilities on Goldman Sachs and Ftfa Franklin 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 Goldman Sachs with a short position of Ftfa Franklin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Ftfa Franklin.
Diversification Opportunities for Goldman Sachs and Ftfa Franklin
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Goldman and Ftfa is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Growth and Ftfa Franklin Templeton Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ftfa Franklin Templeton and Goldman Sachs 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 Goldman Sachs Growth are associated (or correlated) with Ftfa Franklin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ftfa Franklin Templeton has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Ftfa Franklin go up and down completely randomly.
Pair Corralation between Goldman Sachs and Ftfa Franklin
Assuming the 90 days horizon Goldman Sachs is expected to generate 1.71 times less return on investment than Ftfa Franklin. But when comparing it to its historical volatility, Goldman Sachs Growth is 1.19 times less risky than Ftfa Franklin. It trades about 0.11 of its potential returns per unit of risk. Ftfa Franklin Templeton Growth is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 2,010 in Ftfa Franklin Templeton Growth on September 3, 2024 and sell it today you would earn a total of 111.00 from holding Ftfa Franklin Templeton Growth or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Growth vs. Ftfa Franklin Templeton Growth
Performance |
| Timeline |
| Goldman Sachs Growth |
| Ftfa Franklin Templeton |
Goldman Sachs and Ftfa Franklin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Ftfa Franklin
The main advantage of trading using opposite Goldman Sachs and Ftfa Franklin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Ftfa Franklin 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 Ftfa Franklin will offset losses from the drop in Ftfa Franklin's long position.| Goldman Sachs vs. Ftfa Franklin Templeton Growth | Goldman Sachs vs. William Blair Growth | Goldman Sachs vs. Rational Defensive Growth | Goldman Sachs vs. Chase Growth Fund |
| Ftfa Franklin vs. American Funds The | Ftfa Franklin vs. American Funds The | Ftfa Franklin vs. Income Fund Of | Ftfa Franklin vs. Income Fund Of |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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