Correlation Between Templeton Emerging and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Templeton Emerging and Eaton Vance 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 Emerging and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Emerging Markets and Eaton Vance Floating Rate, you can compare the effects of market volatilities on Templeton Emerging and Eaton Vance 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 Emerging with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Emerging and Eaton Vance.
Diversification Opportunities for Templeton Emerging and Eaton Vance
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Templeton and Eaton is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Emerging Markets and Eaton Vance Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Floating and Templeton Emerging 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 Emerging Markets are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Floating has no effect on the direction of Templeton Emerging i.e., Templeton Emerging and Eaton Vance go up and down completely randomly.
Pair Corralation between Templeton Emerging and Eaton Vance
Assuming the 90 days horizon Templeton Emerging Markets is expected to under-perform the Eaton Vance. In addition to that, Templeton Emerging is 4.03 times more volatile than Eaton Vance Floating Rate. It trades about -0.03 of its total potential returns per unit of risk. Eaton Vance Floating Rate is currently generating about 0.21 per unit of volatility. If you would invest 855.00 in Eaton Vance Floating Rate on September 12, 2024 and sell it today you would earn a total of 13.00 from holding Eaton Vance Floating Rate or generate 1.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Templeton Emerging Markets vs. Eaton Vance Floating Rate
Performance |
| Timeline |
| Templeton Emerging |
| Eaton Vance Floating |
Templeton Emerging and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Emerging and Eaton Vance
The main advantage of trading using opposite Templeton Emerging and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Emerging position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Templeton Emerging vs. Guidemark Smallmid Cap | Templeton Emerging vs. Siit Small Mid | Templeton Emerging vs. Mutual Of America | Templeton Emerging vs. Aqr Small Cap |
| Eaton Vance vs. Janus High Yield Fund | Eaton Vance vs. Neuberger Berman Income | Eaton Vance vs. Strategic Advisers Income | Eaton Vance vs. Artisan High Income |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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