Correlation Between Franklin Templeton and Tidal Trust
Can any of the company-specific risk be diversified away by investing in both Franklin Templeton and Tidal Trust 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 Templeton and Tidal Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Templeton ETF and Tidal Trust II, you can compare the effects of market volatilities on Franklin Templeton and Tidal Trust 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 Templeton with a short position of Tidal Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Templeton and Tidal Trust.
Diversification Opportunities for Franklin Templeton and Tidal Trust
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and Tidal is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Templeton ETF and Tidal Trust II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tidal Trust II and Franklin Templeton 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 Templeton ETF are associated (or correlated) with Tidal Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tidal Trust II has no effect on the direction of Franklin Templeton i.e., Franklin Templeton and Tidal Trust go up and down completely randomly.
Pair Corralation between Franklin Templeton and Tidal Trust
Given the investment horizon of 90 days Franklin Templeton ETF is expected to generate 0.18 times more return on investment than Tidal Trust. However, Franklin Templeton ETF is 5.65 times less risky than Tidal Trust. It trades about -0.29 of its potential returns per unit of risk. Tidal Trust II is currently generating about -0.25 per unit of risk. If you would invest 2,683 in Franklin Templeton ETF on October 9, 2024 and sell it today you would lose (64.00) from holding Franklin Templeton ETF or give up 2.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Templeton ETF vs. Tidal Trust II
Performance |
| Timeline |
| Franklin Templeton ETF |
| Tidal Trust II |
Franklin Templeton and Tidal Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Templeton and Tidal Trust
The main advantage of trading using opposite Franklin Templeton and Tidal Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Templeton position performs unexpectedly, Tidal Trust 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 Tidal Trust will offset losses from the drop in Tidal Trust's long position.| Franklin Templeton vs. Tidal Trust II | Franklin Templeton vs. Draco Evolution AI | Franklin Templeton vs. ProShares VIX Mid Term | Franklin Templeton vs. ProShares VIX Short Term |
| Tidal Trust vs. Draco Evolution AI | Tidal Trust vs. ProShares VIX Mid Term | Tidal Trust vs. ProShares VIX Short Term | Tidal Trust vs. First Trust Alternative |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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