Correlation Between Templeton Foreign and Clearbridge Value
Can any of the company-specific risk be diversified away by investing in both Templeton Foreign and Clearbridge Value 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 Foreign and Clearbridge Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Foreign Fund and Clearbridge Value Trust, you can compare the effects of market volatilities on Templeton Foreign and Clearbridge Value 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 Foreign with a short position of Clearbridge Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Foreign and Clearbridge Value.
Diversification Opportunities for Templeton Foreign and Clearbridge Value
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Templeton and Clearbridge is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Foreign Fund and Clearbridge Value Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Value Trust and Templeton Foreign 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 Foreign Fund are associated (or correlated) with Clearbridge Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Value Trust has no effect on the direction of Templeton Foreign i.e., Templeton Foreign and Clearbridge Value go up and down completely randomly.
Pair Corralation between Templeton Foreign and Clearbridge Value
Assuming the 90 days horizon Templeton Foreign Fund is expected to under-perform the Clearbridge Value. In addition to that, Templeton Foreign is 1.17 times more volatile than Clearbridge Value Trust. It trades about -0.03 of its total potential returns per unit of risk. Clearbridge Value Trust is currently generating about 0.1 per unit of volatility. If you would invest 12,827 in Clearbridge Value Trust on August 29, 2024 and sell it today you would earn a total of 1,505 from holding Clearbridge Value Trust or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Templeton Foreign Fund vs. Clearbridge Value Trust
Performance |
| Timeline |
| Templeton Foreign |
| Clearbridge Value Trust |
Templeton Foreign and Clearbridge Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Foreign and Clearbridge Value
The main advantage of trading using opposite Templeton Foreign and Clearbridge Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Foreign position performs unexpectedly, Clearbridge Value 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 Clearbridge Value will offset losses from the drop in Clearbridge Value's long position.| Templeton Foreign vs. Ab Value Fund | Templeton Foreign vs. Barings Active Short | Templeton Foreign vs. Qs Growth Fund | Templeton Foreign vs. Nasdaq 100 Index Fund |
| Clearbridge Value vs. Blackrock Government Bond | Clearbridge Value vs. Aig Government Money | Clearbridge Value vs. Dunham Porategovernment Bond | Clearbridge Value vs. Us Government Securities |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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