Correlation Between Siit Emerging and Franklin Strategic
Can any of the company-specific risk be diversified away by investing in both Siit Emerging and Franklin Strategic 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 Siit Emerging and Franklin Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit Emerging Markets and Franklin Strategic Income, you can compare the effects of market volatilities on Siit Emerging and Franklin Strategic 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 Siit Emerging with a short position of Franklin Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit Emerging and Franklin Strategic.
Diversification Opportunities for Siit Emerging and Franklin Strategic
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Siit and Franklin is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Siit Emerging Markets and Franklin Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Strategic Income and Siit Emerging 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 Siit Emerging Markets are associated (or correlated) with Franklin Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Strategic Income has no effect on the direction of Siit Emerging i.e., Siit Emerging and Franklin Strategic go up and down completely randomly.
Pair Corralation between Siit Emerging and Franklin Strategic
Assuming the 90 days horizon Siit Emerging Markets is expected to generate 3.16 times more return on investment than Franklin Strategic. However, Siit Emerging is 3.16 times more volatile than Franklin Strategic Income. It trades about 0.05 of its potential returns per unit of risk. Franklin Strategic Income is currently generating about 0.01 per unit of risk. If you would invest 971.00 in Siit Emerging Markets on September 2, 2024 and sell it today you would earn a total of 23.00 from holding Siit Emerging Markets or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siit Emerging Markets vs. Franklin Strategic Income
Performance |
| Timeline |
| Siit Emerging Markets |
| Franklin Strategic Income |
Siit Emerging and Franklin Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit Emerging and Franklin Strategic
The main advantage of trading using opposite Siit Emerging and Franklin Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit Emerging position performs unexpectedly, Franklin Strategic 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 Strategic will offset losses from the drop in Franklin Strategic's long position.| Siit Emerging vs. Saat Market Growth | Siit Emerging vs. Simt Real Return | Siit Emerging vs. Simt Small Cap | Siit Emerging vs. Siit Screened World |
| Franklin Strategic vs. Gmo Resources | Franklin Strategic vs. Franklin Natural Resources | Franklin Strategic vs. Dreyfus Natural Resources | Franklin Strategic vs. Icon Natural Resources |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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