Correlation Between Franklin Mutual and James Balanced
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and James Balanced 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 James Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual European and James Balanced Golden, you can compare the effects of market volatilities on Franklin Mutual and James Balanced 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 James Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and James Balanced.
Diversification Opportunities for Franklin Mutual and James Balanced
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Franklin and James is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual European and James Balanced Golden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on James Balanced Golden 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 European are associated (or correlated) with James Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of James Balanced Golden has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and James Balanced go up and down completely randomly.
Pair Corralation between Franklin Mutual and James Balanced
Assuming the 90 days horizon Franklin Mutual European is expected to generate 0.88 times more return on investment than James Balanced. However, Franklin Mutual European is 1.14 times less risky than James Balanced. It trades about 0.21 of its potential returns per unit of risk. James Balanced Golden is currently generating about -0.06 per unit of risk. If you would invest 2,481 in Franklin Mutual European on September 13, 2024 and sell it today you would earn a total of 55.00 from holding Franklin Mutual European or generate 2.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual European vs. James Balanced Golden
Performance |
| Timeline |
| Franklin Mutual European |
| James Balanced Golden |
Franklin Mutual and James Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and James Balanced
The main advantage of trading using opposite Franklin Mutual and James Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, James Balanced 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 James Balanced will offset losses from the drop in James Balanced's long position.| Franklin Mutual vs. Franklin Small Mid Cap | Franklin Mutual vs. Blackrock Glbl Sm | Franklin Mutual vs. Blackrock Fundamental Growth | Franklin Mutual vs. Blackrock Gbl Alloc |
| James Balanced vs. Permanent Portfolio Class | James Balanced vs. Berwyn Income Fund | James Balanced vs. Large Cap Fund | James Balanced vs. Westcore Plus Bond |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |