Correlation Between Templeton Global and Franklin Corefolio
Can any of the company-specific risk be diversified away by investing in both Templeton Global and Franklin Corefolio 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 Corefolio 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 Efolio Allocation, you can compare the effects of market volatilities on Templeton Global and Franklin Corefolio 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 Corefolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Global and Franklin Corefolio.
Diversification Opportunities for Templeton Global and Franklin Corefolio
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Templeton and Franklin is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Global Bond and Franklin Efolio Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Efolio Allo 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 Corefolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Efolio Allo has no effect on the direction of Templeton Global i.e., Templeton Global and Franklin Corefolio go up and down completely randomly.
Pair Corralation between Templeton Global and Franklin Corefolio
Assuming the 90 days horizon Templeton Global Bond is expected to under-perform the Franklin Corefolio. But the mutual fund apears to be less risky and, when comparing its historical volatility, Templeton Global Bond is 1.55 times less risky than Franklin Corefolio. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Franklin Efolio Allocation is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,246 in Franklin Efolio Allocation on September 1, 2024 and sell it today you would earn a total of 114.00 from holding Franklin Efolio Allocation or generate 5.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Templeton Global Bond vs. Franklin Efolio Allocation
Performance |
| Timeline |
| Templeton Global Bond |
| Franklin Efolio Allo |
Templeton Global and Franklin Corefolio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Global and Franklin Corefolio
The main advantage of trading using opposite Templeton Global and Franklin Corefolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Global position performs unexpectedly, Franklin Corefolio 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 Corefolio will offset losses from the drop in Franklin Corefolio'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 Corefolio vs. Franklin Mutual Beacon | Franklin Corefolio vs. Templeton Developing Markets | Franklin Corefolio vs. Franklin Mutual Global | Franklin Corefolio vs. Franklin Mutual Global |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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