Correlation Between Steward Covered and Franklin Real
Can any of the company-specific risk be diversified away by investing in both Steward Covered and Franklin Real 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 Steward Covered and Franklin Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steward Ered Call and Franklin Real Estate, you can compare the effects of market volatilities on Steward Covered and Franklin Real 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 Steward Covered with a short position of Franklin Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steward Covered and Franklin Real.
Diversification Opportunities for Steward Covered and Franklin Real
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Steward and Franklin is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Steward Ered Call and Franklin Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Real Estate and Steward Covered 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 Steward Ered Call are associated (or correlated) with Franklin Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Real Estate has no effect on the direction of Steward Covered i.e., Steward Covered and Franklin Real go up and down completely randomly.
Pair Corralation between Steward Covered and Franklin Real
Assuming the 90 days horizon Steward Covered is expected to generate 1.05 times less return on investment than Franklin Real. But when comparing it to its historical volatility, Steward Ered Call is 1.53 times less risky than Franklin Real. It trades about 0.04 of its potential returns per unit of risk. Franklin Real Estate is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,798 in Franklin Real Estate on September 4, 2024 and sell it today you would earn a total of 199.00 from holding Franklin Real Estate or generate 11.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Steward Ered Call vs. Franklin Real Estate
Performance |
| Timeline |
| Steward Ered Call |
| Franklin Real Estate |
Steward Covered and Franklin Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steward Covered and Franklin Real
The main advantage of trading using opposite Steward Covered and Franklin Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steward Covered position performs unexpectedly, Franklin Real 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 Real will offset losses from the drop in Franklin Real's long position.| Steward Covered vs. Abr 7525 Volatility | Steward Covered vs. Ab Value Fund | Steward Covered vs. Falcon Focus Scv | Steward Covered vs. Leggmason Partners Institutional |
| Franklin Real vs. Realty Income | Franklin Real vs. Dynex Capital | Franklin Real vs. First Industrial Realty | Franklin Real vs. Healthcare Realty Trust |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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