Correlation Between PowerUp Acquisition and Franklin Resources
Can any of the company-specific risk be diversified away by investing in both PowerUp Acquisition and Franklin Resources 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 PowerUp Acquisition and Franklin Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PowerUp Acquisition Corp and Franklin Resources, you can compare the effects of market volatilities on PowerUp Acquisition and Franklin Resources 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 PowerUp Acquisition with a short position of Franklin Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of PowerUp Acquisition and Franklin Resources.
Diversification Opportunities for PowerUp Acquisition and Franklin Resources
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PowerUp and Franklin is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PowerUp Acquisition Corp and Franklin Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Resources and PowerUp Acquisition 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 PowerUp Acquisition Corp are associated (or correlated) with Franklin Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Resources has no effect on the direction of PowerUp Acquisition i.e., PowerUp Acquisition and Franklin Resources go up and down completely randomly.
Pair Corralation between PowerUp Acquisition and Franklin Resources
Assuming the 90 days horizon PowerUp Acquisition Corp is expected to generate 58.31 times more return on investment than Franklin Resources. However, PowerUp Acquisition is 58.31 times more volatile than Franklin Resources. It trades about 0.11 of its potential returns per unit of risk. Franklin Resources is currently generating about -0.01 per unit of risk. If you would invest 5.99 in PowerUp Acquisition Corp on September 3, 2024 and sell it today you would lose (4.04) from holding PowerUp Acquisition Corp or give up 67.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 62.11% |
| Values | Daily Returns |
PowerUp Acquisition Corp vs. Franklin Resources
Performance |
| Timeline |
| PowerUp Acquisition Corp |
| Franklin Resources |
PowerUp Acquisition and Franklin Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PowerUp Acquisition and Franklin Resources
The main advantage of trading using opposite PowerUp Acquisition and Franklin Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PowerUp Acquisition position performs unexpectedly, Franklin Resources 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 Resources will offset losses from the drop in Franklin Resources' long position.The idea behind PowerUp Acquisition Corp and Franklin Resources pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Franklin Resources vs. BlackRock | Franklin Resources vs. Main Street Capital | Franklin Resources vs. Blackstone Group | Franklin Resources vs. Ares Capital |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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