Correlation Between Victory High and Franklin High
Can any of the company-specific risk be diversified away by investing in both Victory High and Franklin High 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 High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Victory High Income and Franklin High Income, you can compare the effects of market volatilities on Victory High and Franklin High 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 High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory High and Franklin High.
Diversification Opportunities for Victory High and Franklin High
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Victory and Franklin is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Victory High Income and Franklin High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin High Income 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 Income are associated (or correlated) with Franklin High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin High Income has no effect on the direction of Victory High i.e., Victory High and Franklin High go up and down completely randomly.
Pair Corralation between Victory High and Franklin High
Assuming the 90 days horizon Victory High Income is expected to generate 1.57 times more return on investment than Franklin High. However, Victory High is 1.57 times more volatile than Franklin High Income. It trades about 0.18 of its potential returns per unit of risk. Franklin High Income is currently generating about 0.16 per unit of risk. If you would invest 911.00 in Victory High Income on September 1, 2024 and sell it today you would earn a total of 75.00 from holding Victory High Income or generate 8.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory High Income vs. Franklin High Income
Performance |
| Timeline |
| Victory High Income |
| Franklin High Income |
Victory High and Franklin High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory High and Franklin High
The main advantage of trading using opposite Victory High and Franklin High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory High position performs unexpectedly, Franklin High 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 High will offset losses from the drop in Franklin High's long position.| Victory High vs. Victory Rs International | Victory High vs. Victory High Yield | Victory High vs. Victory Sycamore Established | Victory High vs. Victory Integrity Discovery |
| Franklin High vs. Franklin Mutual Beacon | Franklin High vs. Templeton Developing Markets | Franklin High vs. Franklin Mutual Global | Franklin High vs. Franklin Mutual Global |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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