Correlation Between Franklin Mutual and Voya Target
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Voya Target 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 Voya Target into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual Beacon and Voya Target Retirement, you can compare the effects of market volatilities on Franklin Mutual and Voya Target 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 Voya Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Voya Target.
Diversification Opportunities for Franklin Mutual and Voya Target
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Voya is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual Beacon and Voya Target Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Target Retirement 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 Beacon are associated (or correlated) with Voya Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Target Retirement has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Voya Target go up and down completely randomly.
Pair Corralation between Franklin Mutual and Voya Target
Assuming the 90 days horizon Franklin Mutual is expected to generate 1.46 times less return on investment than Voya Target. In addition to that, Franklin Mutual is 1.26 times more volatile than Voya Target Retirement. It trades about 0.07 of its total potential returns per unit of risk. Voya Target Retirement is currently generating about 0.13 per unit of volatility. If you would invest 1,185 in Voya Target Retirement on September 3, 2024 and sell it today you would earn a total of 238.00 from holding Voya Target Retirement or generate 20.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual Beacon vs. Voya Target Retirement
Performance |
| Timeline |
| Franklin Mutual Beacon |
| Voya Target Retirement |
Franklin Mutual and Voya Target Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Voya Target
The main advantage of trading using opposite Franklin Mutual and Voya Target positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Voya Target 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 Voya Target will offset losses from the drop in Voya Target's long position.| Franklin Mutual vs. Prudential Government Money | Franklin Mutual vs. Dws Government Money | Franklin Mutual vs. Elfun Government Money | Franklin Mutual vs. Aig Government Money |
| Voya Target vs. Massmutual Premier Diversified | Voya Target vs. Lord Abbett Diversified | Voya Target vs. Aqr Diversified Arbitrage | Voya Target vs. Adams Diversified Equity |
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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