Correlation Between Allianzgi Health and Franklin Emerging
Can any of the company-specific risk be diversified away by investing in both Allianzgi Health and Franklin Emerging 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 Allianzgi Health and Franklin Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianzgi Health Sciences and Franklin Emerging Market, you can compare the effects of market volatilities on Allianzgi Health and Franklin Emerging 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 Allianzgi Health with a short position of Franklin Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Health and Franklin Emerging.
Diversification Opportunities for Allianzgi Health and Franklin Emerging
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Allianzgi and Franklin is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Health Sciences and Franklin Emerging Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Emerging Market and Allianzgi Health 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 Allianzgi Health Sciences are associated (or correlated) with Franklin Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Emerging Market has no effect on the direction of Allianzgi Health i.e., Allianzgi Health and Franklin Emerging go up and down completely randomly.
Pair Corralation between Allianzgi Health and Franklin Emerging
Assuming the 90 days horizon Allianzgi Health is expected to generate 3.37 times less return on investment than Franklin Emerging. In addition to that, Allianzgi Health is 2.78 times more volatile than Franklin Emerging Market. It trades about 0.02 of its total potential returns per unit of risk. Franklin Emerging Market is currently generating about 0.23 per unit of volatility. If you would invest 942.00 in Franklin Emerging Market on September 19, 2024 and sell it today you would earn a total of 272.00 from holding Franklin Emerging Market or generate 28.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allianzgi Health Sciences vs. Franklin Emerging Market
Performance |
| Timeline |
| Allianzgi Health Sciences |
| Franklin Emerging Market |
Allianzgi Health and Franklin Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Health and Franklin Emerging
The main advantage of trading using opposite Allianzgi Health and Franklin Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Health position performs unexpectedly, Franklin Emerging 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 Emerging will offset losses from the drop in Franklin Emerging's long position.| Allianzgi Health vs. Allianzgi Nfj International | Allianzgi Health vs. Allianzgi Vertible Fund | Allianzgi Health vs. Allianzgi Nfj Mid Cap | Allianzgi Health vs. Allianzgi Focused Growth |
| Franklin Emerging vs. Prudential Health Sciences | Franklin Emerging vs. Alger Health Sciences | Franklin Emerging vs. Allianzgi Health Sciences | Franklin Emerging vs. Live Oak Health |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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