Correlation Between Clearbridge Value and Templeton Global
Can any of the company-specific risk be diversified away by investing in both Clearbridge Value and Templeton Global 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 Clearbridge Value and Templeton Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clearbridge Value Trust and Templeton Global Total, you can compare the effects of market volatilities on Clearbridge Value and Templeton Global 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 Clearbridge Value with a short position of Templeton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clearbridge Value and Templeton Global.
Diversification Opportunities for Clearbridge Value and Templeton Global
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Clearbridge and Templeton is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Clearbridge Value Trust and Templeton Global Total in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Global Total and Clearbridge Value 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 Clearbridge Value Trust are associated (or correlated) with Templeton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Global Total has no effect on the direction of Clearbridge Value i.e., Clearbridge Value and Templeton Global go up and down completely randomly.
Pair Corralation between Clearbridge Value and Templeton Global
Assuming the 90 days horizon Clearbridge Value Trust is expected to generate 1.58 times more return on investment than Templeton Global. However, Clearbridge Value is 1.58 times more volatile than Templeton Global Total. It trades about 0.06 of its potential returns per unit of risk. Templeton Global Total is currently generating about 0.02 per unit of risk. If you would invest 8,649 in Clearbridge Value Trust on September 3, 2024 and sell it today you would earn a total of 2,554 from holding Clearbridge Value Trust or generate 29.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clearbridge Value Trust vs. Templeton Global Total
Performance |
| Timeline |
| Clearbridge Value Trust |
| Templeton Global Total |
Clearbridge Value and Templeton Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clearbridge Value and Templeton Global
The main advantage of trading using opposite Clearbridge Value and Templeton Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clearbridge Value position performs unexpectedly, Templeton Global 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 Templeton Global will offset losses from the drop in Templeton Global's long position.| Clearbridge Value vs. Ishares Municipal Bond | Clearbridge Value vs. Vanguard California Long Term | Clearbridge Value vs. Victory High Income | Clearbridge Value vs. Federated Pennsylvania Municipal |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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