Correlation Between Guidemark Smallmid and Franklin Small
Can any of the company-specific risk be diversified away by investing in both Guidemark Smallmid and Franklin Small 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 Guidemark Smallmid and Franklin Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidemark Smallmid Cap and Franklin Small Cap, you can compare the effects of market volatilities on Guidemark Smallmid and Franklin Small 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 Guidemark Smallmid with a short position of Franklin Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark Smallmid and Franklin Small.
Diversification Opportunities for Guidemark Smallmid and Franklin Small
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guidemark and Franklin is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Smallmid Cap and Franklin Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Small Cap and Guidemark Smallmid 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 Guidemark Smallmid Cap are associated (or correlated) with Franklin Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Small Cap has no effect on the direction of Guidemark Smallmid i.e., Guidemark Smallmid and Franklin Small go up and down completely randomly.
Pair Corralation between Guidemark Smallmid and Franklin Small
Assuming the 90 days horizon Guidemark Smallmid Cap is expected to generate 0.92 times more return on investment than Franklin Small. However, Guidemark Smallmid Cap is 1.08 times less risky than Franklin Small. It trades about 0.06 of its potential returns per unit of risk. Franklin Small Cap is currently generating about 0.05 per unit of risk. If you would invest 1,657 in Guidemark Smallmid Cap on September 14, 2024 and sell it today you would earn a total of 612.00 from holding Guidemark Smallmid Cap or generate 36.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidemark Smallmid Cap vs. Franklin Small Cap
Performance |
| Timeline |
| Guidemark Smallmid Cap |
| Franklin Small Cap |
Guidemark Smallmid and Franklin Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidemark Smallmid and Franklin Small
The main advantage of trading using opposite Guidemark Smallmid and Franklin Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark Smallmid position performs unexpectedly, Franklin Small 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 Small will offset losses from the drop in Franklin Small's long position.| Guidemark Smallmid vs. Fidelity Advisor Gold | Guidemark Smallmid vs. James Balanced Golden | Guidemark Smallmid vs. Vy Goldman Sachs | Guidemark Smallmid vs. Oppenheimer Gold Special |
| Franklin Small vs. Small Pany Growth | Franklin Small vs. Foundry Partners Fundamental | Franklin Small vs. Ab Small Cap | Franklin Small vs. Guidemark Smallmid Cap |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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