Correlation Between Franklin Lifesmart and Virtus Nfj

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

By analyzing existing cross correlation between Franklin Lifesmart 2035 and Virtus Nfj Large Cap, you can compare the effects of market volatilities on Franklin Lifesmart and Virtus Nfj 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 Lifesmart with a short position of Virtus Nfj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Lifesmart and Virtus Nfj.

Diversification Opportunities for Franklin Lifesmart and Virtus Nfj

0.0

Correlation Coefficient

Franklin Lifesmart  Virtus Nfj

Pay attention - limited upside

The 3 months correlation between Franklin and Virtus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Lifesmart 2035 and Virtus Nfj Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Nfj Large and Franklin Lifesmart 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 Lifesmart 2035 are associated (or correlated) with Virtus Nfj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Nfj Large has no effect on the direction of Franklin Lifesmart i.e., Franklin Lifesmart and Virtus Nfj go up and down completely randomly.

Pair Corralation between Franklin Lifesmart and Virtus Nfj

If you would invest  2,372  in Virtus Nfj Large Cap on October 4, 2024 and sell it today you would earn a total of  362.00  from holding Virtus Nfj Large Cap or generate 15.26% return on investment over 90 days.

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

Franklin Lifesmart 2035  vs.  Virtus Nfj Large Cap

Franklin Lifesmart 2035

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Franklin Lifesmart 2035 has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Franklin Lifesmart is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Virtus Nfj Large

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Virtus Nfj Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Virtus Nfj is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Franklin Lifesmart and Virtus Nfj

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

The idea behind Franklin Lifesmart 2035 and Virtus Nfj Large Cap 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.