Correlation Between Franklin Mutual and Ab Global
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Ab Global 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 Franklin Mutual and Ab Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual Global and Ab Global Risk, you can compare the effects of market volatilities on Franklin Mutual and Ab Global 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 Franklin Mutual with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Ab Global.
Diversification Opportunities for Franklin Mutual and Ab Global
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and CBSYX is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual Global and Ab Global Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Risk and Franklin Mutual 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 Franklin Mutual Global are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Risk has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Ab Global go up and down completely randomly.
Pair Corralation between Franklin Mutual and Ab Global
Assuming the 90 days horizon Franklin Mutual Global is expected to generate 0.9 times more return on investment than Ab Global. However, Franklin Mutual Global is 1.11 times less risky than Ab Global. It trades about 0.06 of its potential returns per unit of risk. Ab Global Risk is currently generating about 0.0 per unit of risk. If you would invest 2,587 in Franklin Mutual Global on September 13, 2024 and sell it today you would earn a total of 569.00 from holding Franklin Mutual Global or generate 21.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual Global vs. Ab Global Risk
Performance |
| Timeline |
| Franklin Mutual Global |
| Ab Global Risk |
Franklin Mutual and Ab Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Ab Global
The main advantage of trading using opposite Franklin Mutual and Ab Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Ab Global 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 Ab Global will offset losses from the drop in Ab Global's long position.| Franklin Mutual vs. Ab Small Cap | Franklin Mutual vs. Cardinal Small Cap | Franklin Mutual vs. Pace Smallmedium Value | Franklin Mutual vs. Vy Columbia Small |
| Ab Global vs. Lord Abbett Short | Ab Global vs. Touchstone Ultra Short | Ab Global vs. Quantitative Longshort Equity | Ab Global vs. Siit Ultra Short |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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