Correlation Between Triumph Bancorp and Franklin Credit
Can any of the company-specific risk be diversified away by investing in both Triumph Bancorp and Franklin Credit 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 Triumph Bancorp and Franklin Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triumph Bancorp and Franklin Credit Management, you can compare the effects of market volatilities on Triumph Bancorp and Franklin Credit 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 Triumph Bancorp with a short position of Franklin Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triumph Bancorp and Franklin Credit.
Diversification Opportunities for Triumph Bancorp and Franklin Credit
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Triumph and Franklin is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Triumph Bancorp and Franklin Credit Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Credit Mana and Triumph Bancorp 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 Triumph Bancorp are associated (or correlated) with Franklin Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Credit Mana has no effect on the direction of Triumph Bancorp i.e., Triumph Bancorp and Franklin Credit go up and down completely randomly.
Pair Corralation between Triumph Bancorp and Franklin Credit
Considering the 90-day investment horizon Triumph Bancorp is expected to generate 30.24 times more return on investment than Franklin Credit. However, Triumph Bancorp is 30.24 times more volatile than Franklin Credit Management. It trades about 0.31 of its potential returns per unit of risk. Franklin Credit Management is currently generating about 0.03 per unit of risk. If you would invest 4,886 in Triumph Bancorp on September 5, 2024 and sell it today you would lose (4,886) from holding Triumph Bancorp or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 3.04% |
| Values | Daily Returns |
Triumph Bancorp vs. Franklin Credit Management
Performance |
| Timeline |
| Triumph Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Franklin Credit Mana |
Triumph Bancorp and Franklin Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triumph Bancorp and Franklin Credit
The main advantage of trading using opposite Triumph Bancorp and Franklin Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triumph Bancorp position performs unexpectedly, Franklin Credit 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 Credit will offset losses from the drop in Franklin Credit's long position.| Triumph Bancorp vs. Franklin Credit Management | Triumph Bancorp vs. Viemed Healthcare | Triumph Bancorp vs. Marfrig Global Foods | Triumph Bancorp vs. Omni Health |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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