Correlation Between Transocean and Franklin Street
Can any of the company-specific risk be diversified away by investing in both Transocean and Franklin Street 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 Transocean and Franklin Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transocean and Franklin Street Properties, you can compare the effects of market volatilities on Transocean and Franklin Street 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 Transocean with a short position of Franklin Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transocean and Franklin Street.
Diversification Opportunities for Transocean and Franklin Street
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Transocean and Franklin is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Transocean and Franklin Street Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Street Prop and Transocean 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 Transocean are associated (or correlated) with Franklin Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Street Prop has no effect on the direction of Transocean i.e., Transocean and Franklin Street go up and down completely randomly.
Pair Corralation between Transocean and Franklin Street
Considering the 90-day investment horizon Transocean is expected to under-perform the Franklin Street. In addition to that, Transocean is 1.28 times more volatile than Franklin Street Properties. It trades about -0.14 of its total potential returns per unit of risk. Franklin Street Properties is currently generating about 0.05 per unit of volatility. If you would invest 182.00 in Franklin Street Properties on November 30, 2024 and sell it today you would earn a total of 6.00 from holding Franklin Street Properties or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Transocean vs. Franklin Street Properties
Performance |
| Timeline |
| Transocean |
| Franklin Street Prop |
Transocean and Franklin Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transocean and Franklin Street
The main advantage of trading using opposite Transocean and Franklin Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transocean position performs unexpectedly, Franklin Street 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 Street will offset losses from the drop in Franklin Street's long position.| Transocean vs. Timken Company | Transocean vs. Snap On | Transocean vs. Eastman Kodak Co | Transocean vs. JD Sports Fashion |
| Franklin Street vs. Cousins Properties Incorporated | Franklin Street vs. Creative Media Community | Franklin Street vs. Highwoods Properties | Franklin Street vs. Douglas Emmett |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |