Correlation Between Thrivent High and Franklin Utilities
Can any of the company-specific risk be diversified away by investing in both Thrivent High and Franklin Utilities 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 Thrivent High and Franklin Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thrivent High Yield and Franklin Utilities Fund, you can compare the effects of market volatilities on Thrivent High and Franklin Utilities 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 Thrivent High with a short position of Franklin Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent High and Franklin Utilities.
Diversification Opportunities for Thrivent High and Franklin Utilities
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thrivent and Franklin is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent High Yield and Franklin Utilities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Utilities and Thrivent High 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 Thrivent High Yield are associated (or correlated) with Franklin Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Utilities has no effect on the direction of Thrivent High i.e., Thrivent High and Franklin Utilities go up and down completely randomly.
Pair Corralation between Thrivent High and Franklin Utilities
Assuming the 90 days horizon Thrivent High is expected to generate 6.25 times less return on investment than Franklin Utilities. But when comparing it to its historical volatility, Thrivent High Yield is 4.41 times less risky than Franklin Utilities. It trades about 0.22 of its potential returns per unit of risk. Franklin Utilities Fund is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 2,230 in Franklin Utilities Fund on November 29, 2024 and sell it today you would earn a total of 100.00 from holding Franklin Utilities Fund or generate 4.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thrivent High Yield vs. Franklin Utilities Fund
Performance |
| Timeline |
| Thrivent High Yield |
| Franklin Utilities |
Thrivent High and Franklin Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrivent High and Franklin Utilities
The main advantage of trading using opposite Thrivent High and Franklin Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrivent High position performs unexpectedly, Franklin Utilities 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 Utilities will offset losses from the drop in Franklin Utilities' long position.| Thrivent High vs. Thrivent Limited Maturity | Thrivent High vs. Thrivent Income Fund | Thrivent High vs. Thrivent Large Cap | Thrivent High vs. Thrivent Large Cap |
| Franklin Utilities vs. Scharf Global Opportunity | Franklin Utilities vs. Buffalo High Yield | Franklin Utilities vs. Barings Active Short | Franklin Utilities vs. Nasdaq 100 2x Strategy |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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