Correlation Between Old Westbury and Franklin Microcap
Can any of the company-specific risk be diversified away by investing in both Old Westbury and Franklin Microcap 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 Old Westbury and Franklin Microcap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Westbury Short Term and Franklin Microcap Value, you can compare the effects of market volatilities on Old Westbury and Franklin Microcap 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 Old Westbury with a short position of Franklin Microcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Franklin Microcap.
Diversification Opportunities for Old Westbury and Franklin Microcap
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Old and Franklin is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Short Term and Franklin Microcap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Microcap Value and Old Westbury 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 Old Westbury Short Term are associated (or correlated) with Franklin Microcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Microcap Value has no effect on the direction of Old Westbury i.e., Old Westbury and Franklin Microcap go up and down completely randomly.
Pair Corralation between Old Westbury and Franklin Microcap
Assuming the 90 days horizon Old Westbury Short Term is expected to generate 0.07 times more return on investment than Franklin Microcap. However, Old Westbury Short Term is 14.39 times less risky than Franklin Microcap. It trades about 0.17 of its potential returns per unit of risk. Franklin Microcap Value is currently generating about -0.02 per unit of risk. If you would invest 961.00 in Old Westbury Short Term on January 11, 2025 and sell it today you would earn a total of 53.00 from holding Old Westbury Short Term or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 56.48% |
| Values | Daily Returns |
Old Westbury Short Term vs. Franklin Microcap Value
Performance |
| Timeline |
| Old Westbury Short |
| Franklin Microcap Value |
Old Westbury and Franklin Microcap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Franklin Microcap
The main advantage of trading using opposite Old Westbury and Franklin Microcap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury position performs unexpectedly, Franklin Microcap 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 Microcap will offset losses from the drop in Franklin Microcap's long position.| Old Westbury vs. Delaware Minnesota High Yield | Old Westbury vs. Nuveen Short Duration High | Old Westbury vs. Franklin High Yield | Old Westbury vs. T Rowe Price |
| Franklin Microcap vs. Franklin Mutual Beacon | Franklin Microcap vs. Templeton Developing Markets | Franklin Microcap vs. Franklin Mutual Global | Franklin Microcap vs. Franklin Mutual Global |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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