Correlation Between Victory High and Franklin New
Can any of the company-specific risk be diversified away by investing in both Victory High and Franklin New 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 Victory High and Franklin New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Victory High Yield and Franklin New York, you can compare the effects of market volatilities on Victory High and Franklin New 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 Victory High with a short position of Franklin New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory High and Franklin New.
Diversification Opportunities for Victory High and Franklin New
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Victory and Franklin is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Victory High Yield and Franklin New York in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin New York and Victory High 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 Victory High Yield are associated (or correlated) with Franklin New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin New York has no effect on the direction of Victory High i.e., Victory High and Franklin New go up and down completely randomly.
Pair Corralation between Victory High and Franklin New
Assuming the 90 days horizon Victory High Yield is expected to generate 1.19 times more return on investment than Franklin New. However, Victory High is 1.19 times more volatile than Franklin New York. It trades about 0.1 of its potential returns per unit of risk. Franklin New York is currently generating about 0.05 per unit of risk. If you would invest 478.00 in Victory High Yield on September 3, 2024 and sell it today you would earn a total of 78.00 from holding Victory High Yield or generate 16.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory High Yield vs. Franklin New York
Performance |
| Timeline |
| Victory High Yield |
| Franklin New York |
Victory High and Franklin New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory High and Franklin New
The main advantage of trading using opposite Victory High and Franklin New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory High position performs unexpectedly, Franklin New 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 New will offset losses from the drop in Franklin New's long position.| Victory High vs. Multimanager Lifestyle Aggressive | Victory High vs. Ab Global Risk | Victory High vs. Western Asset High | Victory High vs. Ab High Income |
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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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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