Correlation Between Franklin Mutual and Templeton Growth
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Templeton Growth 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 Templeton Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual European and Templeton Growth Fund, you can compare the effects of market volatilities on Franklin Mutual and Templeton Growth 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 Templeton Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Templeton Growth.
Diversification Opportunities for Franklin Mutual and Templeton Growth
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Templeton is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual European and Templeton Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Growth 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 European are associated (or correlated) with Templeton Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Growth has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Templeton Growth go up and down completely randomly.
Pair Corralation between Franklin Mutual and Templeton Growth
Assuming the 90 days horizon Franklin Mutual European is expected to generate 1.02 times more return on investment than Templeton Growth. However, Franklin Mutual is 1.02 times more volatile than Templeton Growth Fund. It trades about 0.06 of its potential returns per unit of risk. Templeton Growth Fund is currently generating about 0.05 per unit of risk. If you would invest 2,227 in Franklin Mutual European on November 1, 2024 and sell it today you would earn a total of 250.00 from holding Franklin Mutual European or generate 11.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual European vs. Templeton Growth Fund
Performance |
| Timeline |
| Franklin Mutual European |
| Templeton Growth |
Franklin Mutual and Templeton Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Templeton Growth
The main advantage of trading using opposite Franklin Mutual and Templeton Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Templeton Growth 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 Templeton Growth will offset losses from the drop in Templeton Growth's long position.| Franklin Mutual vs. Wells Fargo Advantage | Franklin Mutual vs. Vy Goldman Sachs | Franklin Mutual vs. Gabelli Gold Fund | Franklin Mutual vs. Oppenheimer Gold Special |
| Templeton Growth vs. Old Westbury Short Term | Templeton Growth vs. Aqr Sustainable Long Short | Templeton Growth vs. Cmg Ultra Short | Templeton Growth vs. Touchstone Ultra Short |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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