Correlation Between Franklin Mutual and Saat Aggressive
Can any of the company-specific risk be diversified away by investing in both Franklin Mutual and Saat Aggressive 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 Saat Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Mutual Shares and Saat Aggressive Strategy, you can compare the effects of market volatilities on Franklin Mutual and Saat Aggressive 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 Saat Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Mutual and Saat Aggressive.
Diversification Opportunities for Franklin Mutual and Saat Aggressive
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Saat is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Mutual Shares and Saat Aggressive Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Aggressive Strategy 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 Shares are associated (or correlated) with Saat Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Aggressive Strategy has no effect on the direction of Franklin Mutual i.e., Franklin Mutual and Saat Aggressive go up and down completely randomly.
Pair Corralation between Franklin Mutual and Saat Aggressive
Assuming the 90 days horizon Franklin Mutual Shares is expected to generate 1.64 times more return on investment than Saat Aggressive. However, Franklin Mutual is 1.64 times more volatile than Saat Aggressive Strategy. It trades about 0.27 of its potential returns per unit of risk. Saat Aggressive Strategy is currently generating about 0.14 per unit of risk. If you would invest 2,739 in Franklin Mutual Shares on August 28, 2024 and sell it today you would earn a total of 144.00 from holding Franklin Mutual Shares or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Mutual Shares vs. Saat Aggressive Strategy
Performance |
| Timeline |
| Franklin Mutual Shares |
| Saat Aggressive Strategy |
Franklin Mutual and Saat Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Mutual and Saat Aggressive
The main advantage of trading using opposite Franklin Mutual and Saat Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Mutual position performs unexpectedly, Saat Aggressive 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 Saat Aggressive will offset losses from the drop in Saat Aggressive's long position.| Franklin Mutual vs. Templeton Growth Fund | Franklin Mutual vs. Franklin Mutual Global | Franklin Mutual vs. Franklin Income Fund | Franklin Mutual vs. Franklin Rising Dividends |
| Saat Aggressive vs. Saat Market Growth | Saat Aggressive vs. Saat Moderate Strategy | Saat Aggressive vs. Saat Servative Strategy | Saat Aggressive vs. Simt Large Cap |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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