Correlation Between Knights Of and Franklin Lifesmart
Can any of the company-specific risk be diversified away by investing in both Knights Of and Franklin Lifesmart 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 Knights Of and Franklin Lifesmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knights Of Umbus and Franklin Lifesmart Retirement, you can compare the effects of market volatilities on Knights Of and Franklin Lifesmart 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 Knights Of with a short position of Franklin Lifesmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knights Of and Franklin Lifesmart.
Diversification Opportunities for Knights Of and Franklin Lifesmart
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Knights and FRANKLIN is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Knights Of Umbus and Franklin Lifesmart Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Lifesmart and Knights Of 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 Knights Of Umbus are associated (or correlated) with Franklin Lifesmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Lifesmart has no effect on the direction of Knights Of i.e., Knights Of and Franklin Lifesmart go up and down completely randomly.
Pair Corralation between Knights Of and Franklin Lifesmart
Assuming the 90 days horizon Knights Of is expected to generate 2.67 times less return on investment than Franklin Lifesmart. In addition to that, Knights Of is 1.01 times more volatile than Franklin Lifesmart Retirement. It trades about 0.04 of its total potential returns per unit of risk. Franklin Lifesmart Retirement is currently generating about 0.12 per unit of volatility. If you would invest 924.00 in Franklin Lifesmart Retirement on August 31, 2024 and sell it today you would earn a total of 157.00 from holding Franklin Lifesmart Retirement or generate 16.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Knights Of Umbus vs. Franklin Lifesmart Retirement
Performance |
| Timeline |
| Knights Of Umbus |
| Franklin Lifesmart |
Knights Of and Franklin Lifesmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knights Of and Franklin Lifesmart
The main advantage of trading using opposite Knights Of and Franklin Lifesmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knights Of position performs unexpectedly, Franklin Lifesmart 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 Lifesmart will offset losses from the drop in Franklin Lifesmart's long position.| Knights Of vs. Moderately Aggressive Balanced | Knights Of vs. Franklin Lifesmart Retirement | Knights Of vs. Saat Moderate Strategy | Knights Of vs. Franklin Lifesmart Retirement |
| Franklin Lifesmart vs. Vanguard Target Retirement | Franklin Lifesmart vs. Jpmorgan Smartretirement Income | Franklin Lifesmart vs. HUMANA INC | Franklin Lifesmart vs. Aquagold International |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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