Correlation Between Balanced Strategy and Franklin Growth
Can any of the company-specific risk be diversified away by investing in both Balanced Strategy and Franklin Growth 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 Balanced Strategy and Franklin Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Balanced Strategy Fund and Franklin Growth Fund, you can compare the effects of market volatilities on Balanced Strategy and Franklin Growth 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 Balanced Strategy with a short position of Franklin Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balanced Strategy and Franklin Growth.
Diversification Opportunities for Balanced Strategy and Franklin Growth
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Balanced and Franklin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Balanced Strategy Fund and Franklin Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Growth and Balanced 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 Balanced Strategy Fund are associated (or correlated) with Franklin Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Growth has no effect on the direction of Balanced Strategy i.e., Balanced Strategy and Franklin Growth go up and down completely randomly.
Pair Corralation between Balanced Strategy and Franklin Growth
If you would invest 1,031 in Balanced Strategy Fund on October 25, 2024 and sell it today you would earn a total of 11.00 from holding Balanced Strategy Fund or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.56% |
| Values | Daily Returns |
Balanced Strategy Fund vs. Franklin Growth Fund
Performance |
| Timeline |
| Balanced Strategy |
| Franklin Growth |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Balanced Strategy and Franklin Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Balanced Strategy and Franklin Growth
The main advantage of trading using opposite Balanced Strategy and Franklin Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Balanced Strategy position performs unexpectedly, Franklin Growth 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 Growth will offset losses from the drop in Franklin Growth's long position.| Balanced Strategy vs. Schwab Government Money | Balanced Strategy vs. Hsbc Treasury Money | Balanced Strategy vs. Vanguard Money Market | Balanced Strategy vs. Hewitt Money Market |
| Franklin Growth vs. Voya High Yield | Franklin Growth vs. Transamerica High Yield | Franklin Growth vs. Dunham High Yield | Franklin Growth vs. Buffalo High Yield |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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