Correlation Between FiscalNote Holdings and Franklin Credit
Can any of the company-specific risk be diversified away by investing in both FiscalNote Holdings and Franklin Credit 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 FiscalNote Holdings and Franklin Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FiscalNote Holdings and Franklin Credit Management, you can compare the effects of market volatilities on FiscalNote Holdings and Franklin Credit 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 FiscalNote Holdings with a short position of Franklin Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of FiscalNote Holdings and Franklin Credit.
Diversification Opportunities for FiscalNote Holdings and Franklin Credit
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FiscalNote and Franklin is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding FiscalNote Holdings and Franklin Credit Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Credit Mana and FiscalNote Holdings 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 FiscalNote Holdings are associated (or correlated) with Franklin Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Credit Mana has no effect on the direction of FiscalNote Holdings i.e., FiscalNote Holdings and Franklin Credit go up and down completely randomly.
Pair Corralation between FiscalNote Holdings and Franklin Credit
Given the investment horizon of 90 days FiscalNote Holdings is expected to under-perform the Franklin Credit. But the stock apears to be less risky and, when comparing its historical volatility, FiscalNote Holdings is 2.27 times less risky than Franklin Credit. The stock trades about -0.02 of its potential returns per unit of risk. The Franklin Credit Management is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Franklin Credit Management on August 31, 2024 and sell it today you would lose (9.00) from holding Franklin Credit Management or give up 45.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
FiscalNote Holdings vs. Franklin Credit Management
Performance |
| Timeline |
| FiscalNote Holdings |
| Franklin Credit Mana |
FiscalNote Holdings and Franklin Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FiscalNote Holdings and Franklin Credit
The main advantage of trading using opposite FiscalNote Holdings and Franklin Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FiscalNote Holdings position performs unexpectedly, Franklin Credit 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 Credit will offset losses from the drop in Franklin Credit's long position.| FiscalNote Holdings vs. Innodata | FiscalNote Holdings vs. International Business Machines | FiscalNote Holdings vs. Aurora Innovation | FiscalNote Holdings vs. BigBearai Holdings |
| Franklin Credit vs. HUMANA INC | Franklin Credit vs. SCOR PK | Franklin Credit vs. Aquagold International | Franklin Credit vs. Thrivent High Yield |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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