Correlation Between Needham Aggressive and Franklin
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Franklin 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 Needham Aggressive and Franklin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Franklin Government Money, you can compare the effects of market volatilities on Needham Aggressive and Franklin 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 Needham Aggressive with a short position of Franklin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Franklin.
Diversification Opportunities for Needham Aggressive and Franklin
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Needham and Franklin is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Franklin Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Government Money and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Franklin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Government Money has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Franklin go up and down completely randomly.
Pair Corralation between Needham Aggressive and Franklin
If you would invest 100.00 in Franklin Government Money on November 7, 2024 and sell it today you would earn a total of 0.00 from holding Franklin Government Money or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Franklin Government Money
Performance |
| Timeline |
| Needham Aggressive Growth |
| Franklin Government Money |
Needham Aggressive and Franklin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Franklin
The main advantage of trading using opposite Needham Aggressive and Franklin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Franklin 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 will offset losses from the drop in Franklin's long position.| Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Ultramid Cap Profund Ultramid Cap | Needham Aggressive vs. Fidelity Advisor Semiconductors |
| Franklin vs. California Municipal Portfolio | Franklin vs. Barings High Yield | Franklin vs. Bbh Intermediate Municipal | Franklin vs. Goldman Sachs 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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