Correlation Between Artisan Thematic and Franklin Templeton

Can any of the company-specific risk be diversified away by investing in both Artisan Thematic and Franklin Templeton 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 Artisan Thematic and Franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Artisan Thematic Fund and Franklin Templeton Smacs, you can compare the effects of market volatilities on Artisan Thematic and Franklin Templeton 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 Artisan Thematic with a short position of Franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Thematic and Franklin Templeton.

Diversification Opportunities for Artisan Thematic and Franklin Templeton

0.21

Correlation Coefficient

Artisan Thematic  Franklin Templeton

Modest diversification

The 3 months correlation between Artisan and Franklin is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Franklin Templeton Smacs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Templeton Smacs and Artisan Thematic 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 Artisan Thematic Fund are associated (or correlated) with Franklin Templeton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Templeton Smacs has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Franklin Templeton go up and down completely randomly.

Pair Corralation between Artisan Thematic and Franklin Templeton

Assuming the 90 days horizon Artisan Thematic Fund is expected to under-perform the Franklin Templeton. In addition to that, Artisan Thematic is 1.14 times more volatile than Franklin Templeton Smacs. It trades about -0.02 of its total potential returns per unit of risk. Franklin Templeton Smacs is currently generating about 0.02 per unit of volatility. If you would invest  848.00  in Franklin Templeton Smacs on December 30, 2024 and sell it today you would earn a total of  8.00  from holding Franklin Templeton Smacs or generate 0.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Artisan Thematic Fund  vs.  Franklin Templeton Smacs

Artisan Thematic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Artisan Thematic Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Artisan Thematic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Franklin Templeton Smacs

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Franklin Templeton Smacs are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Franklin Templeton is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Artisan Thematic and Franklin Templeton

The main advantage of trading using opposite Artisan Thematic and Franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Thematic position performs unexpectedly, Franklin Templeton 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 Templeton will offset losses from the drop in Franklin Templeton's long position.

The idea behind Artisan Thematic Fund and Franklin Templeton Smacs pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.