Correlation Between Lkcm International and Franklin Moderate
Can any of the company-specific risk be diversified away by investing in both Lkcm International and Franklin Moderate 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 Lkcm International and Franklin Moderate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lkcm International Equity and Franklin Moderate Allocation, you can compare the effects of market volatilities on Lkcm International and Franklin Moderate 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 Lkcm International with a short position of Franklin Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lkcm International and Franklin Moderate.
Diversification Opportunities for Lkcm International and Franklin Moderate
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lkcm and Franklin is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Lkcm International Equity and Franklin Moderate Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Moderate and Lkcm International 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 Lkcm International Equity are associated (or correlated) with Franklin Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Moderate has no effect on the direction of Lkcm International i.e., Lkcm International and Franklin Moderate go up and down completely randomly.
Pair Corralation between Lkcm International and Franklin Moderate
Assuming the 90 days horizon Lkcm International is expected to generate 1.66 times less return on investment than Franklin Moderate. In addition to that, Lkcm International is 1.62 times more volatile than Franklin Moderate Allocation. It trades about 0.04 of its total potential returns per unit of risk. Franklin Moderate Allocation is currently generating about 0.11 per unit of volatility. If you would invest 1,333 in Franklin Moderate Allocation on September 2, 2024 and sell it today you would earn a total of 296.00 from holding Franklin Moderate Allocation or generate 22.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lkcm International Equity vs. Franklin Moderate Allocation
Performance |
| Timeline |
| Lkcm International Equity |
| Franklin Moderate |
Lkcm International and Franklin Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lkcm International and Franklin Moderate
The main advantage of trading using opposite Lkcm International and Franklin Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lkcm International position performs unexpectedly, Franklin Moderate 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 Moderate will offset losses from the drop in Franklin Moderate's long position.| Lkcm International vs. Lkcm Aquinas Catholic | Lkcm International vs. Lkcm Balanced Fund | Lkcm International vs. Lkcm Equity Fund | Lkcm International vs. Lkcm Fixed Income |
| Franklin Moderate vs. Jennison Natural Resources | Franklin Moderate vs. Oil Gas Ultrasector | Franklin Moderate vs. Clearbridge Energy Mlp | Franklin Moderate vs. Alpsalerian Energy Infrastructure |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |