Correlation Between Harbor Diversified and Franklin Gold
Can any of the company-specific risk be diversified away by investing in both Harbor Diversified and Franklin Gold 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 Harbor Diversified and Franklin Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harbor Diversified International and Franklin Gold Precious, you can compare the effects of market volatilities on Harbor Diversified and Franklin Gold 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 Harbor Diversified with a short position of Franklin Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbor Diversified and Franklin Gold.
Diversification Opportunities for Harbor Diversified and Franklin Gold
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Harbor and Franklin is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Harbor Diversified Internation and Franklin Gold Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Gold Precious and Harbor Diversified 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 Harbor Diversified International are associated (or correlated) with Franklin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Gold Precious has no effect on the direction of Harbor Diversified i.e., Harbor Diversified and Franklin Gold go up and down completely randomly.
Pair Corralation between Harbor Diversified and Franklin Gold
Assuming the 90 days horizon Harbor Diversified is expected to generate 2.08 times less return on investment than Franklin Gold. But when comparing it to its historical volatility, Harbor Diversified International is 3.2 times less risky than Franklin Gold. It trades about 0.06 of its potential returns per unit of risk. Franklin Gold Precious is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,844 in Franklin Gold Precious on September 12, 2024 and sell it today you would earn a total of 22.00 from holding Franklin Gold Precious or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harbor Diversified Internation vs. Franklin Gold Precious
Performance |
| Timeline |
| Harbor Diversified |
| Franklin Gold Precious |
Harbor Diversified and Franklin Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harbor Diversified and Franklin Gold
The main advantage of trading using opposite Harbor Diversified and Franklin Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbor Diversified position performs unexpectedly, Franklin Gold 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 Gold will offset losses from the drop in Franklin Gold's long position.| Harbor Diversified vs. Investec Emerging Markets | Harbor Diversified vs. Franklin Emerging Market | Harbor Diversified vs. Artisan Emerging Markets | Harbor Diversified vs. Transamerica Emerging Markets |
| Franklin Gold vs. Columbia Global Technology | Franklin Gold vs. Towpath Technology | Franklin Gold vs. Red Oak Technology | Franklin Gold vs. Goldman Sachs Technology |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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