Correlation Between Saat Core and Franklin Mutual
Can any of the company-specific risk be diversified away by investing in both Saat Core and Franklin Mutual 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 Saat Core and Franklin Mutual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat E Market and Franklin Mutual Shares, you can compare the effects of market volatilities on Saat Core and Franklin Mutual 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 Saat Core with a short position of Franklin Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Core and Franklin Mutual.
Diversification Opportunities for Saat Core and Franklin Mutual
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Saat and Franklin is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Saat E Market and Franklin Mutual Shares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Mutual Shares and Saat Core 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 Saat E Market are associated (or correlated) with Franklin Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Mutual Shares has no effect on the direction of Saat Core i.e., Saat Core and Franklin Mutual go up and down completely randomly.
Pair Corralation between Saat Core and Franklin Mutual
Assuming the 90 days horizon Saat Core is expected to generate 2.2 times less return on investment than Franklin Mutual. But when comparing it to its historical volatility, Saat E Market is 1.34 times less risky than Franklin Mutual. It trades about 0.17 of its potential returns per unit of risk. Franklin Mutual Shares is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,739 in Franklin Mutual Shares on August 28, 2024 and sell it today you would earn a total of 144.00 from holding Franklin Mutual Shares or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Saat E Market vs. Franklin Mutual Shares
Performance |
| Timeline |
| Saat E Market |
| Franklin Mutual Shares |
Saat Core and Franklin Mutual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Core and Franklin Mutual
The main advantage of trading using opposite Saat Core and Franklin Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Core position performs unexpectedly, Franklin Mutual 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 Mutual will offset losses from the drop in Franklin Mutual's long position.| Saat Core vs. Saat Tax Managed Aggressive | Saat Core vs. Saat Moderate Strategy | Saat Core vs. Simt Tax Managed Managed | Saat Core vs. Hartford Schroders Smallmid |
| Franklin Mutual vs. Templeton Growth Fund | Franklin Mutual vs. Franklin Mutual Global | Franklin Mutual vs. Franklin Income Fund | Franklin Mutual vs. Franklin Rising Dividends |
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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