Correlation Between Templeton Developing and Clearbridge International
Can any of the company-specific risk be diversified away by investing in both Templeton Developing and Clearbridge International 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 Templeton Developing and Clearbridge International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Developing Markets and Clearbridge International Value, you can compare the effects of market volatilities on Templeton Developing and Clearbridge International 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 Templeton Developing with a short position of Clearbridge International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Developing and Clearbridge International.
Diversification Opportunities for Templeton Developing and Clearbridge International
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Templeton and Clearbridge is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Developing Markets and Clearbridge International Valu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge International and Templeton Developing 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 Templeton Developing Markets are associated (or correlated) with Clearbridge International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge International has no effect on the direction of Templeton Developing i.e., Templeton Developing and Clearbridge International go up and down completely randomly.
Pair Corralation between Templeton Developing and Clearbridge International
Assuming the 90 days horizon Templeton Developing Markets is expected to under-perform the Clearbridge International. In addition to that, Templeton Developing is 1.04 times more volatile than Clearbridge International Value. It trades about -0.15 of its total potential returns per unit of risk. Clearbridge International Value is currently generating about -0.04 per unit of volatility. If you would invest 1,069 in Clearbridge International Value on September 3, 2024 and sell it today you would lose (8.00) from holding Clearbridge International Value or give up 0.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Templeton Developing Markets vs. Clearbridge International Valu
Performance |
| Timeline |
| Templeton Developing |
| Clearbridge International |
Templeton Developing and Clearbridge International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Developing and Clearbridge International
The main advantage of trading using opposite Templeton Developing and Clearbridge International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Developing position performs unexpectedly, Clearbridge International 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 Clearbridge International will offset losses from the drop in Clearbridge International's long position.| Templeton Developing vs. Franklin Mutual Global | Templeton Developing vs. Templeton Growth Fund | Templeton Developing vs. Franklin Real Estate | Templeton Developing vs. HUMANA INC |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |