Correlation Between Red Oak and Ftfa-franklin Templeton
Can any of the company-specific risk be diversified away by investing in both Red Oak and Ftfa-franklin Templeton 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 Red Oak and Ftfa-franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Oak Technology and Ftfa Franklin Templeton Growth, you can compare the effects of market volatilities on Red Oak and Ftfa-franklin Templeton 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 Red Oak with a short position of Ftfa-franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Oak and Ftfa-franklin Templeton.
Diversification Opportunities for Red Oak and Ftfa-franklin Templeton
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Red and Ftfa-franklin is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Red Oak Technology and Ftfa Franklin Templeton Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ftfa Franklin Templeton and Red Oak 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 Red Oak Technology are associated (or correlated) with Ftfa-franklin Templeton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ftfa Franklin Templeton has no effect on the direction of Red Oak i.e., Red Oak and Ftfa-franklin Templeton go up and down completely randomly.
Pair Corralation between Red Oak and Ftfa-franklin Templeton
Assuming the 90 days horizon Red Oak is expected to generate 1.06 times less return on investment than Ftfa-franklin Templeton. In addition to that, Red Oak is 2.06 times more volatile than Ftfa Franklin Templeton Growth. It trades about 0.05 of its total potential returns per unit of risk. Ftfa Franklin Templeton Growth is currently generating about 0.11 per unit of volatility. If you would invest 1,633 in Ftfa Franklin Templeton Growth on December 7, 2024 and sell it today you would earn a total of 425.00 from holding Ftfa Franklin Templeton Growth or generate 26.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Oak Technology vs. Ftfa Franklin Templeton Growth
Performance |
| Timeline |
| Red Oak Technology |
| Ftfa Franklin Templeton |
Red Oak and Ftfa-franklin Templeton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Oak and Ftfa-franklin Templeton
The main advantage of trading using opposite Red Oak and Ftfa-franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Oak position performs unexpectedly, Ftfa-franklin Templeton 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 Ftfa-franklin Templeton will offset losses from the drop in Ftfa-franklin Templeton's long position.| Red Oak vs. Pin Oak Equity | Red Oak vs. White Oak Select | Red Oak vs. Black Oak Emerging | Red Oak vs. Berkshire Focus |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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