Correlation Between Growth Strategy and Franklin Rising
Can any of the company-specific risk be diversified away by investing in both Growth Strategy and Franklin Rising 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 Growth Strategy and Franklin Rising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Strategy Fund and Franklin Rising Dividends, you can compare the effects of market volatilities on Growth Strategy and Franklin Rising 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 Growth Strategy with a short position of Franklin Rising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Strategy and Franklin Rising.
Diversification Opportunities for Growth Strategy and Franklin Rising
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between GROWTH and Franklin is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Growth Strategy Fund and Franklin Rising Dividends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Rising Dividends and Growth Strategy 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 Growth Strategy Fund are associated (or correlated) with Franklin Rising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Rising Dividends has no effect on the direction of Growth Strategy i.e., Growth Strategy and Franklin Rising go up and down completely randomly.
Pair Corralation between Growth Strategy and Franklin Rising
Assuming the 90 days horizon Growth Strategy Fund is expected to generate 0.93 times more return on investment than Franklin Rising. However, Growth Strategy Fund is 1.08 times less risky than Franklin Rising. It trades about 0.1 of its potential returns per unit of risk. Franklin Rising Dividends is currently generating about 0.07 per unit of risk. If you would invest 1,066 in Growth Strategy Fund on August 31, 2024 and sell it today you would earn a total of 272.00 from holding Growth Strategy Fund or generate 25.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Strategy Fund vs. Franklin Rising Dividends
Performance |
| Timeline |
| Growth Strategy |
| Franklin Rising Dividends |
Growth Strategy and Franklin Rising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Strategy and Franklin Rising
The main advantage of trading using opposite Growth Strategy and Franklin Rising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Strategy position performs unexpectedly, Franklin Rising 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 Rising will offset losses from the drop in Franklin Rising's long position.| Growth Strategy vs. American Funds The | Growth Strategy vs. Income Fund Of | Growth Strategy vs. Income Fund Of | Growth Strategy vs. Income Fund Of |
| Franklin Rising vs. Growth Strategy Fund | Franklin Rising vs. Eagle Mlp Strategy | Franklin Rising vs. Transamerica Emerging Markets | Franklin Rising vs. Investec Emerging Markets |
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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