Correlation Between Mackenzie Unconstrained and Franklin Global
Can any of the company-specific risk be diversified away by investing in both Mackenzie Unconstrained and Franklin 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 Mackenzie Unconstrained and Franklin Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mackenzie Unconstrained Bond and Franklin Global Aggregate, you can compare the effects of market volatilities on Mackenzie Unconstrained and Franklin 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 Mackenzie Unconstrained with a short position of Franklin Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mackenzie Unconstrained and Franklin Global.
Diversification Opportunities for Mackenzie Unconstrained and Franklin Global
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mackenzie and Franklin is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Mackenzie Unconstrained Bond and Franklin Global Aggregate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Global Aggregate and Mackenzie Unconstrained 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 Mackenzie Unconstrained Bond are associated (or correlated) with Franklin Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Global Aggregate has no effect on the direction of Mackenzie Unconstrained i.e., Mackenzie Unconstrained and Franklin Global go up and down completely randomly.
Pair Corralation between Mackenzie Unconstrained and Franklin Global
Assuming the 90 days trading horizon Mackenzie Unconstrained Bond is expected to generate 0.99 times more return on investment than Franklin Global. However, Mackenzie Unconstrained Bond is 1.01 times less risky than Franklin Global. It trades about 0.1 of its potential returns per unit of risk. Franklin Global Aggregate is currently generating about 0.07 per unit of risk. If you would invest 1,845 in Mackenzie Unconstrained Bond on August 29, 2024 and sell it today you would earn a total of 12.00 from holding Mackenzie Unconstrained Bond or generate 0.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mackenzie Unconstrained Bond vs. Franklin Global Aggregate
Performance |
| Timeline |
| Mackenzie Unconstrained |
| Franklin Global Aggregate |
Mackenzie Unconstrained and Franklin Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mackenzie Unconstrained and Franklin Global
The main advantage of trading using opposite Mackenzie Unconstrained and Franklin Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mackenzie Unconstrained position performs unexpectedly, Franklin 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 Franklin Global will offset losses from the drop in Franklin Global's long position.| Mackenzie Unconstrained vs. Mackenzie Floating Rate | Mackenzie Unconstrained vs. Mackenzie Core Plus | Mackenzie Unconstrained vs. Mackenzie Core Plus | Mackenzie Unconstrained vs. PIMCO Monthly Income |
| Franklin Global vs. Mackenzie Core Plus | Franklin Global vs. Mackenzie Floating Rate | Franklin Global vs. Mackenzie Unconstrained Bond | Franklin Global vs. Mackenzie Canadian Short |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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