Correlation Between Franklin Resources and RiverNorthDoubleLine
Can any of the company-specific risk be diversified away by investing in both Franklin Resources and RiverNorthDoubleLine 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 Resources and RiverNorthDoubleLine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Resources and RiverNorthDoubleLine Strategic Opportunity, you can compare the effects of market volatilities on Franklin Resources and RiverNorthDoubleLine 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 Resources with a short position of RiverNorthDoubleLine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Resources and RiverNorthDoubleLine.
Diversification Opportunities for Franklin Resources and RiverNorthDoubleLine
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Franklin and RiverNorthDoubleLine is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Resources and RiverNorthDoubleLine Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RiverNorthDoubleLine and Franklin Resources 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 Resources are associated (or correlated) with RiverNorthDoubleLine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RiverNorthDoubleLine has no effect on the direction of Franklin Resources i.e., Franklin Resources and RiverNorthDoubleLine go up and down completely randomly.
Pair Corralation between Franklin Resources and RiverNorthDoubleLine
Considering the 90-day investment horizon Franklin Resources is expected to generate 2.49 times more return on investment than RiverNorthDoubleLine. However, Franklin Resources is 2.49 times more volatile than RiverNorthDoubleLine Strategic Opportunity. It trades about 0.21 of its potential returns per unit of risk. RiverNorthDoubleLine Strategic Opportunity is currently generating about -0.07 per unit of risk. If you would invest 1,884 in Franklin Resources on September 6, 2024 and sell it today you would earn a total of 383.00 from holding Franklin Resources or generate 20.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Franklin Resources vs. RiverNorthDoubleLine Strategic
Performance |
Timeline |
Franklin Resources |
RiverNorthDoubleLine |
Franklin Resources and RiverNorthDoubleLine Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Franklin Resources and RiverNorthDoubleLine
The main advantage of trading using opposite Franklin Resources and RiverNorthDoubleLine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Resources position performs unexpectedly, RiverNorthDoubleLine 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 RiverNorthDoubleLine will offset losses from the drop in RiverNorthDoubleLine's long position.Franklin Resources vs. BlackRock | Franklin Resources vs. Main Street Capital | Franklin Resources vs. Blackstone Group | Franklin Resources vs. Ares Capital |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Commodity Directory Find actively traded commodities issued by global exchanges | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |