Correlation Between Templeton China and Dana Epiphany

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

By analyzing existing cross correlation between Templeton China World and Dana Epiphany Esg, you can compare the effects of market volatilities on Templeton China and Dana Epiphany 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 Templeton China with a short position of Dana Epiphany. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton China and Dana Epiphany.

Diversification Opportunities for Templeton China and Dana Epiphany

0.0

Correlation Coefficient

Templeton China  Dana Epiphany

Pay attention - limited upside

The 3 months correlation between Templeton and Dana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Templeton China World and Dana Epiphany Esg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Epiphany Esg and Templeton China 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 Templeton China World are associated (or correlated) with Dana Epiphany. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Epiphany Esg has no effect on the direction of Templeton China i.e., Templeton China and Dana Epiphany go up and down completely randomly.

Pair Corralation between Templeton China and Dana Epiphany

If you would invest (100.00) in Templeton China World on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Templeton China World or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Templeton China World  vs.  Dana Epiphany Esg

Templeton China World

Risk-Adjusted Performance

Very Weak

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

Dana Epiphany Esg

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dana Epiphany Esg has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Templeton China and Dana Epiphany

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

The idea behind Templeton China World and Dana Epiphany Esg 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.

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.