Correlation Between Templeton Global and Franklin Dynatech
Can any of the company-specific risk be diversified away by investing in both Templeton Global and Franklin Dynatech 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 Global and Franklin Dynatech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Global Bond and Franklin Dynatech Fund, you can compare the effects of market volatilities on Templeton Global and Franklin Dynatech 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 Global with a short position of Franklin Dynatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Global and Franklin Dynatech.
Diversification Opportunities for Templeton Global and Franklin Dynatech
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Templeton and Franklin is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Global Bond and Franklin Dynatech Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Dynatech and Templeton Global 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 Global Bond are associated (or correlated) with Franklin Dynatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Dynatech has no effect on the direction of Templeton Global i.e., Templeton Global and Franklin Dynatech go up and down completely randomly.
Pair Corralation between Templeton Global and Franklin Dynatech
Assuming the 90 days horizon Templeton Global Bond is expected to under-perform the Franklin Dynatech. But the mutual fund apears to be less risky and, when comparing its historical volatility, Templeton Global Bond is 2.25 times less risky than Franklin Dynatech. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Franklin Dynatech Fund is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 9,996 in Franklin Dynatech Fund on September 1, 2024 and sell it today you would earn a total of 6,844 from holding Franklin Dynatech Fund or generate 68.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Templeton Global Bond vs. Franklin Dynatech Fund
Performance |
| Timeline |
| Templeton Global Bond |
| Franklin Dynatech |
Templeton Global and Franklin Dynatech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Global and Franklin Dynatech
The main advantage of trading using opposite Templeton Global and Franklin Dynatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Global position performs unexpectedly, Franklin Dynatech 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 Dynatech will offset losses from the drop in Franklin Dynatech's long position.| Templeton Global vs. Alphacentric Lifesci Healthcare | Templeton Global vs. Baillie Gifford Health | Templeton Global vs. The Gabelli Healthcare | Templeton Global vs. Allianzgi Health Sciences |
| Franklin Dynatech vs. Mfs International Diversification | Franklin Dynatech vs. John Hancock Bond | Franklin Dynatech vs. Prudential Total Return | Franklin Dynatech vs. New World Fund |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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