Correlation Between Templeton Growth and Polar Capital
Can any of the company-specific risk be diversified away by investing in both Templeton Growth and Polar Capital 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 Growth and Polar Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Growth Fund and Polar Capital Emerging, you can compare the effects of market volatilities on Templeton Growth and Polar Capital 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 Growth with a short position of Polar Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Growth and Polar Capital.
Diversification Opportunities for Templeton Growth and Polar Capital
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Templeton and Polar is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Growth Fund and Polar Capital Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Capital Emerging and Templeton Growth 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 Growth Fund are associated (or correlated) with Polar Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polar Capital Emerging has no effect on the direction of Templeton Growth i.e., Templeton Growth and Polar Capital go up and down completely randomly.
Pair Corralation between Templeton Growth and Polar Capital
Assuming the 90 days horizon Templeton Growth Fund is expected to generate 0.76 times more return on investment than Polar Capital. However, Templeton Growth Fund is 1.31 times less risky than Polar Capital. It trades about 0.07 of its potential returns per unit of risk. Polar Capital Emerging is currently generating about 0.03 per unit of risk. If you would invest 2,247 in Templeton Growth Fund on September 4, 2024 and sell it today you would earn a total of 565.00 from holding Templeton Growth Fund or generate 25.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Templeton Growth Fund vs. Polar Capital Emerging
Performance |
| Timeline |
| Templeton Growth |
| Polar Capital Emerging |
Templeton Growth and Polar Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Growth and Polar Capital
The main advantage of trading using opposite Templeton Growth and Polar Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Growth position performs unexpectedly, Polar Capital 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 Polar Capital will offset losses from the drop in Polar Capital's long position.| Templeton Growth vs. Prudential Financial Services | Templeton Growth vs. Financials Ultrasector Profund | Templeton Growth vs. Davis Financial Fund | Templeton Growth vs. Fidelity Advisor Financial |
| Polar Capital vs. Franklin Mutual Global | Polar Capital vs. Templeton Growth Fund | Polar Capital vs. Franklin Real Estate | Polar Capital vs. HUMANA INC |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |