Correlation Between Virtus Convertible and Franklin Total
Can any of the company-specific risk be diversified away by investing in both Virtus Convertible and Franklin Total 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 Virtus Convertible and Franklin Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Convertible and Franklin Total Return, you can compare the effects of market volatilities on Virtus Convertible and Franklin Total 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 Virtus Convertible with a short position of Franklin Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Convertible and Franklin Total.
Diversification Opportunities for Virtus Convertible and Franklin Total
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Virtus and Franklin is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Convertible and Franklin Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Total Return and Virtus Convertible 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 Virtus Convertible are associated (or correlated) with Franklin Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Total Return has no effect on the direction of Virtus Convertible i.e., Virtus Convertible and Franklin Total go up and down completely randomly.
Pair Corralation between Virtus Convertible and Franklin Total
Assuming the 90 days horizon Virtus Convertible is expected to generate 1.81 times more return on investment than Franklin Total. However, Virtus Convertible is 1.81 times more volatile than Franklin Total Return. It trades about 0.19 of its potential returns per unit of risk. Franklin Total Return is currently generating about 0.08 per unit of risk. If you would invest 3,229 in Virtus Convertible on September 3, 2024 and sell it today you would earn a total of 493.00 from holding Virtus Convertible or generate 15.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus Convertible vs. Franklin Total Return
Performance |
| Timeline |
| Virtus Convertible |
| Franklin Total Return |
Virtus Convertible and Franklin Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Convertible and Franklin Total
The main advantage of trading using opposite Virtus Convertible and Franklin Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Convertible position performs unexpectedly, Franklin Total 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 Franklin Total will offset losses from the drop in Franklin Total's long position.| Virtus Convertible vs. Franklin Vertible Securities | Virtus Convertible vs. Franklin Vertible Securities | Virtus Convertible vs. Allianzgi Vertible Fund |
| Franklin Total vs. Fidelity Sai Convertible | Franklin Total vs. Absolute Convertible Arbitrage | Franklin Total vs. Virtus Convertible | Franklin Total vs. Gabelli Convertible And |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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