Correlation Between Franklin Mutual and Ab High
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Ab High 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 Franklin Mutual and Ab High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual Global and Ab High Income, you can compare the effects of market volatilities on Franklin Mutual and Ab High 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 Franklin Mutual with a short position of Ab High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Ab High.
Diversification Opportunities for Franklin Mutual and Ab High
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Franklin and AGDAX is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual Global and Ab High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab High Income and Franklin Mutual 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 Franklin Mutual Global are associated (or correlated) with Ab High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab High Income has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Ab High go up and down completely randomly.
Pair Corralation between Franklin Mutual and Ab High
Assuming the 90 days horizon Franklin Mutual is expected to generate 2.69 times less return on investment than Ab High. In addition to that, Franklin Mutual is 2.09 times more volatile than Ab High Income. It trades about 0.06 of its total potential returns per unit of risk. Ab High Income is currently generating about 0.32 per unit of volatility. If you would invest 699.00 in Ab High Income on September 14, 2024 and sell it today you would earn a total of 9.00 from holding Ab High Income or generate 1.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual Global vs. Ab High Income
Performance |
| Timeline |
| Franklin Mutual Global |
| Ab High Income |
Franklin Mutual and Ab High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Ab High
The main advantage of trading using opposite Franklin Mutual and Ab High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Ab High 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 Ab High will offset losses from the drop in Ab High's long position.| Franklin Mutual vs. Ab High Income | Franklin Mutual vs. California High Yield Municipal | Franklin Mutual vs. T Rowe Price | Franklin Mutual vs. Us High Relative |
| Ab High vs. Ab Global E | Ab High vs. Ab Global E | Ab High vs. Ab Global E | Ab High vs. Ab Minnesota Portfolio |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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