Correlation Between Micron Technology and Franklin Efolio
Can any of the company-specific risk be diversified away by investing in both Micron Technology and Franklin Efolio 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 Micron Technology and Franklin Efolio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and Franklin Efolio Allocation, you can compare the effects of market volatilities on Micron Technology and Franklin Efolio 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 Micron Technology with a short position of Franklin Efolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and Franklin Efolio.
Diversification Opportunities for Micron Technology and Franklin Efolio
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Micron and Franklin is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and Franklin Efolio Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Efolio Allo and Micron Technology 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 Micron Technology are associated (or correlated) with Franklin Efolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Efolio Allo has no effect on the direction of Micron Technology i.e., Micron Technology and Franklin Efolio go up and down completely randomly.
Pair Corralation between Micron Technology and Franklin Efolio
Allowing for the 90-day total investment horizon Micron Technology is expected to under-perform the Franklin Efolio. In addition to that, Micron Technology is 4.08 times more volatile than Franklin Efolio Allocation. It trades about -0.12 of its total potential returns per unit of risk. Franklin Efolio Allocation is currently generating about -0.01 per unit of volatility. If you would invest 2,465 in Franklin Efolio Allocation on September 12, 2024 and sell it today you would lose (5.00) from holding Franklin Efolio Allocation or give up 0.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Micron Technology vs. Franklin Efolio Allocation
Performance |
| Timeline |
| Micron Technology |
| Franklin Efolio Allo |
Micron Technology and Franklin Efolio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and Franklin Efolio
The main advantage of trading using opposite Micron Technology and Franklin Efolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology position performs unexpectedly, Franklin Efolio 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 Efolio will offset losses from the drop in Franklin Efolio's long position.| Micron Technology vs. NVIDIA | Micron Technology vs. Intel | Micron Technology vs. Taiwan Semiconductor Manufacturing | Micron Technology vs. Marvell Technology Group |
| Franklin Efolio vs. Lord Abbett Affiliated | Franklin Efolio vs. Qs Large Cap | Franklin Efolio vs. American Mutual Fund | Franklin Efolio vs. Avantis Large Cap |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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