Correlation Between Scharf Global and Franklin Strategic
Can any of the company-specific risk be diversified away by investing in both Scharf Global and Franklin Strategic 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 Scharf Global and Franklin Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scharf Global Opportunity and Franklin Strategic Income, you can compare the effects of market volatilities on Scharf Global and Franklin Strategic 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 Scharf Global with a short position of Franklin Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scharf Global and Franklin Strategic.
Diversification Opportunities for Scharf Global and Franklin Strategic
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Scharf and Franklin is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Scharf Global Opportunity and Franklin Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Strategic Income and Scharf Global 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 Scharf Global Opportunity are associated (or correlated) with Franklin Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Strategic Income has no effect on the direction of Scharf Global i.e., Scharf Global and Franklin Strategic go up and down completely randomly.
Pair Corralation between Scharf Global and Franklin Strategic
Assuming the 90 days horizon Scharf Global Opportunity is expected to under-perform the Franklin Strategic. In addition to that, Scharf Global is 2.42 times more volatile than Franklin Strategic Income. It trades about 0.0 of its total potential returns per unit of risk. Franklin Strategic Income is currently generating about 0.21 per unit of volatility. If you would invest 829.00 in Franklin Strategic Income on September 13, 2024 and sell it today you would earn a total of 7.00 from holding Franklin Strategic Income or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scharf Global Opportunity vs. Franklin Strategic Income
Performance |
| Timeline |
| Scharf Global Opportunity |
| Franklin Strategic Income |
Scharf Global and Franklin Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scharf Global and Franklin Strategic
The main advantage of trading using opposite Scharf Global and Franklin Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scharf Global position performs unexpectedly, Franklin Strategic 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 Strategic will offset losses from the drop in Franklin Strategic's long position.| Scharf Global vs. Invesco Energy Fund | Scharf Global vs. Goehring Rozencwajg Resources | Scharf Global vs. Oil Gas Ultrasector | Scharf Global vs. Jennison Natural Resources |
| Franklin Strategic vs. Franklin Mutual Beacon | Franklin Strategic vs. Templeton Developing Markets | Franklin Strategic vs. Franklin Mutual Global | Franklin Strategic vs. Franklin Mutual Global |
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 Stocks Directory module to find actively traded stocks across global markets.
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