Correlation Between Franklin Libertyshares and SANTANDER
Can any of the company-specific risk be diversified away by investing in both Franklin Libertyshares and SANTANDER 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 Franklin Libertyshares and SANTANDER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Libertyshares ICAV and SANTANDER UK 10, you can compare the effects of market volatilities on Franklin Libertyshares and SANTANDER 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 Franklin Libertyshares with a short position of SANTANDER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Libertyshares and SANTANDER.
Diversification Opportunities for Franklin Libertyshares and SANTANDER
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Franklin and SANTANDER is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Libertyshares ICAV and SANTANDER UK 10 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANTANDER UK 10 and Franklin Libertyshares 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 Franklin Libertyshares ICAV are associated (or correlated) with SANTANDER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANTANDER UK 10 has no effect on the direction of Franklin Libertyshares i.e., Franklin Libertyshares and SANTANDER go up and down completely randomly.
Pair Corralation between Franklin Libertyshares and SANTANDER
Assuming the 90 days trading horizon Franklin Libertyshares ICAV is expected to under-perform the SANTANDER. In addition to that, Franklin Libertyshares is 9.45 times more volatile than SANTANDER UK 10. It trades about -0.21 of its total potential returns per unit of risk. SANTANDER UK 10 is currently generating about 0.02 per unit of volatility. If you would invest 15,650 in SANTANDER UK 10 on August 28, 2024 and sell it today you would earn a total of 5.00 from holding SANTANDER UK 10 or generate 0.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Libertyshares ICAV vs. SANTANDER UK 10
Performance |
| Timeline |
| Franklin Libertyshares |
| SANTANDER UK 10 |
Franklin Libertyshares and SANTANDER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Libertyshares and SANTANDER
The main advantage of trading using opposite Franklin Libertyshares and SANTANDER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Libertyshares position performs unexpectedly, SANTANDER 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 SANTANDER will offset losses from the drop in SANTANDER's long position.| Franklin Libertyshares vs. Scottish Mortgage Investment | Franklin Libertyshares vs. CT Private Equity | Franklin Libertyshares vs. Aberdeen New India | Franklin Libertyshares vs. Invesco Health Care |
| SANTANDER vs. Park Hotels Resorts | SANTANDER vs. Silvercorp Metals | SANTANDER vs. Endeavour Mining Corp | SANTANDER vs. Panther Metals PLC |
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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