Correlation Between Franklin Oregon and Bruce Fund

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

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

Diversification Opportunities for Franklin Oregon and Bruce Fund

0.46

Correlation Coefficient

Franklin Oregon  Bruce Fund

Very weak diversification

The 3 months correlation between Franklin and Bruce is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Oregon Tax Free and Bruce Fund Bruce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bruce Fund Bruce and Franklin Oregon 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 Oregon Tax Free are associated (or correlated) with Bruce Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bruce Fund Bruce has no effect on the direction of Franklin Oregon i.e., Franklin Oregon and Bruce Fund go up and down completely randomly.

Pair Corralation between Franklin Oregon and Bruce Fund

Assuming the 90 days horizon Franklin Oregon Tax Free is expected to generate 0.45 times more return on investment than Bruce Fund. However, Franklin Oregon Tax Free is 2.23 times less risky than Bruce Fund. It trades about 0.07 of its potential returns per unit of risk. Bruce Fund Bruce is currently generating about 0.0 per unit of risk. If you would invest  1,053  in Franklin Oregon Tax Free on September 4, 2024 and sell it today you would earn a total of  11.00  from holding Franklin Oregon Tax Free or generate 1.04% return on investment over 90 days.

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

Franklin Oregon Tax Free  vs.  Bruce Fund Bruce

Franklin Oregon Tax

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Franklin Oregon Tax Free are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Franklin Oregon is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Bruce Fund Bruce

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bruce Fund Bruce has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Bruce Fund 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 Oregon and Bruce Fund

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

The idea behind Franklin Oregon Tax Free and Bruce Fund Bruce 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .