Correlation Between Nebraska Municipal and Templeton Global
Can any of the company-specific risk be diversified away by investing in both Nebraska Municipal and Templeton 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 Nebraska Municipal and Templeton Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nebraska Municipal Fund and Templeton Global Bond, you can compare the effects of market volatilities on Nebraska Municipal and Templeton 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 Nebraska Municipal with a short position of Templeton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nebraska Municipal and Templeton Global.
Diversification Opportunities for Nebraska Municipal and Templeton Global
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nebraska and Templeton is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Nebraska Municipal Fund and Templeton Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Global Bond and Nebraska Municipal 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 Nebraska Municipal Fund are associated (or correlated) with Templeton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Global Bond has no effect on the direction of Nebraska Municipal i.e., Nebraska Municipal and Templeton Global go up and down completely randomly.
Pair Corralation between Nebraska Municipal and Templeton Global
Assuming the 90 days horizon Nebraska Municipal Fund is expected to generate 0.4 times more return on investment than Templeton Global. However, Nebraska Municipal Fund is 2.47 times less risky than Templeton Global. It trades about 0.05 of its potential returns per unit of risk. Templeton Global Bond is currently generating about -0.03 per unit of risk. If you would invest 904.00 in Nebraska Municipal Fund on September 2, 2024 and sell it today you would earn a total of 39.00 from holding Nebraska Municipal Fund or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nebraska Municipal Fund vs. Templeton Global Bond
Performance |
| Timeline |
| Nebraska Municipal |
| Templeton Global Bond |
Nebraska Municipal and Templeton Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nebraska Municipal and Templeton Global
The main advantage of trading using opposite Nebraska Municipal and Templeton Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nebraska Municipal position performs unexpectedly, Templeton 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 Templeton Global will offset losses from the drop in Templeton Global's long position.| Nebraska Municipal vs. Us Vector Equity | Nebraska Municipal vs. Scharf Fund Retail | Nebraska Municipal vs. Huber Capital Equity | Nebraska Municipal vs. Locorr Dynamic Equity |
| Templeton Global vs. Goldman Sachs Emerging | Templeton Global vs. Western Asset Diversified | Templeton Global vs. Locorr Market Trend | Templeton Global vs. Ep Emerging Markets |
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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