Correlation Between Franklin Mutual and Mondrian Global
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Mondrian 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 Mondrian 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 Mondrian Global Equity, you can compare the effects of market volatilities on Franklin Mutual and Mondrian 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 Mondrian Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Mondrian Global.
Diversification Opportunities for Franklin Mutual and Mondrian Global
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Franklin and Mondrian is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual Global and Mondrian Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mondrian Global Equity 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 Mondrian Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mondrian Global Equity has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Mondrian Global go up and down completely randomly.
Pair Corralation between Franklin Mutual and Mondrian Global
Assuming the 90 days horizon Franklin Mutual is expected to generate 1.1 times less return on investment than Mondrian Global. But when comparing it to its historical volatility, Franklin Mutual Global is 1.23 times less risky than Mondrian Global. It trades about 0.4 of its potential returns per unit of risk. Mondrian Global Equity is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 1,359 in Mondrian Global Equity on November 3, 2024 and sell it today you would earn a total of 75.00 from holding Mondrian Global Equity or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual Global vs. Mondrian Global Equity
Performance |
| Timeline |
| Franklin Mutual Global |
| Mondrian Global Equity |
Franklin Mutual and Mondrian Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Mondrian Global
The main advantage of trading using opposite Franklin Mutual and Mondrian Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Mondrian 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 Mondrian Global will offset losses from the drop in Mondrian Global's long position.| Franklin Mutual vs. Morningstar Municipal Bond | Franklin Mutual vs. Jpmorgan Ultra Short Municipal | Franklin Mutual vs. Legg Mason Partners | Franklin Mutual vs. Baird Quality Intermediate |
| Mondrian Global vs. T Rowe Price | Mondrian Global vs. T Rowe Price | Mondrian Global vs. Us Treasury Long Term | Mondrian Global vs. T Rowe Price |
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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