Correlation Between Financial Industries and Franklin Mutual
Can any of the company-specific risk be diversified away by investing in both Financial Industries and Franklin Mutual 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 Financial Industries and Franklin Mutual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Financial Industries Fund and Franklin Mutual Financial, you can compare the effects of market volatilities on Financial Industries and Franklin Mutual 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 Financial Industries with a short position of Franklin Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial Industries and Franklin Mutual.
Diversification Opportunities for Financial Industries and Franklin Mutual
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Financial and Franklin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Financial Industries Fund and Franklin Mutual Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Mutual Financial and Financial Industries 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 Financial Industries Fund are associated (or correlated) with Franklin Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Mutual Financial has no effect on the direction of Financial Industries i.e., Financial Industries and Franklin Mutual go up and down completely randomly.
Pair Corralation between Financial Industries and Franklin Mutual
If you would invest 1,813 in Financial Industries Fund on November 5, 2024 and sell it today you would earn a total of 111.00 from holding Financial Industries Fund or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.56% |
| Values | Daily Returns |
Financial Industries Fund vs. Franklin Mutual Financial
Performance |
| Timeline |
| Financial Industries |
| Franklin Mutual Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Financial Industries and Franklin Mutual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financial Industries and Franklin Mutual
The main advantage of trading using opposite Financial Industries and Franklin Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial Industries position performs unexpectedly, Franklin Mutual 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 Mutual will offset losses from the drop in Franklin Mutual's long position.| Financial Industries vs. Prudential Government Money | Financial Industries vs. Hsbc Government Money | Financial Industries vs. Federated Government Income | Financial Industries vs. Davis Government Bond |
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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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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