Correlation Between Templeton Global and Franklin Mutual
Can any of the company-specific risk be diversified away by investing in both Templeton Global and Franklin Mutual 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 Mutual 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 Mutual Global, you can compare the effects of market volatilities on Templeton Global and Franklin Mutual 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 Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Global and Franklin Mutual.
Diversification Opportunities for Templeton Global and Franklin Mutual
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Templeton and Franklin is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Global Bond and Franklin Mutual Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Mutual Global 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 Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Mutual Global has no effect on the direction of Templeton Global i.e., Templeton Global and Franklin Mutual go up and down completely randomly.
Pair Corralation between Templeton Global and Franklin Mutual
Assuming the 90 days horizon Templeton Global Bond is expected to generate 0.6 times more return on investment than Franklin Mutual. However, Templeton Global Bond is 1.68 times less risky than Franklin Mutual. It trades about -0.03 of its potential returns per unit of risk. Franklin Mutual Global is currently generating about -0.04 per unit of risk. If you would invest 690.00 in Templeton Global Bond on November 9, 2024 and sell it today you would lose (16.00) from holding Templeton Global Bond or give up 2.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Templeton Global Bond vs. Franklin Mutual Global
Performance |
| Timeline |
| Templeton Global Bond |
| Franklin Mutual Global |
Templeton Global and Franklin Mutual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Global and Franklin Mutual
The main advantage of trading using opposite Templeton Global and Franklin Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Global position performs unexpectedly, Franklin Mutual 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 Mutual will offset losses from the drop in Franklin Mutual's long position.| Templeton Global vs. Aig Government Money | Templeton Global vs. Virtus Seix Government | Templeton Global vs. Ab Municipal Bond | Templeton Global vs. Goldman Sachs Short |
| Franklin Mutual vs. T Rowe Price | Franklin Mutual vs. Gmo Quality Fund | Franklin Mutual vs. Auxier Focus Fund | Franklin Mutual vs. Astor Star 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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