Correlation Between Sprott Gold and Franklin Small
Can any of the company-specific risk be diversified away by investing in both Sprott Gold and Franklin Small 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 Sprott Gold and Franklin Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprott Gold Equity and Franklin Small Cap, you can compare the effects of market volatilities on Sprott Gold and Franklin Small 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 Sprott Gold with a short position of Franklin Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Gold and Franklin Small.
Diversification Opportunities for Sprott Gold and Franklin Small
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sprott and Franklin is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Gold Equity and Franklin Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Small Cap and Sprott Gold 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 Sprott Gold Equity are associated (or correlated) with Franklin Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Small Cap has no effect on the direction of Sprott Gold i.e., Sprott Gold and Franklin Small go up and down completely randomly.
Pair Corralation between Sprott Gold and Franklin Small
Assuming the 90 days horizon Sprott Gold Equity is expected to generate 1.46 times more return on investment than Franklin Small. However, Sprott Gold is 1.46 times more volatile than Franklin Small Cap. It trades about -0.09 of its potential returns per unit of risk. Franklin Small Cap is currently generating about -0.14 per unit of risk. If you would invest 5,649 in Sprott Gold Equity on October 10, 2024 and sell it today you would lose (207.00) from holding Sprott Gold Equity or give up 3.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sprott Gold Equity vs. Franklin Small Cap
Performance |
| Timeline |
| Sprott Gold Equity |
| Franklin Small Cap |
Sprott Gold and Franklin Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprott Gold and Franklin Small
The main advantage of trading using opposite Sprott Gold and Franklin Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprott Gold position performs unexpectedly, Franklin Small 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 Small will offset losses from the drop in Franklin Small's long position.| Sprott Gold vs. Sprott Junior Gold | Sprott Gold vs. Sprott Gold Miners | Sprott Gold vs. Europac Gold Fund | Sprott Gold vs. US Global GO |
| Franklin Small vs. Blackrock All Cap Energy | Franklin Small vs. Goehring Rozencwajg Resources | Franklin Small vs. Icon Natural Resources | Franklin Small vs. Tortoise Energy Independence |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |