Correlation Between Franklin Growth and Investment Managers

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

By analyzing existing cross correlation between Franklin Growth Opportunities and Investment Managers Series, you can compare the effects of market volatilities on Franklin Growth and Investment Managers 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 Growth with a short position of Investment Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and Investment Managers.

Diversification Opportunities for Franklin Growth and Investment Managers

0.0

Correlation Coefficient

Franklin Growth  Investment Managers

Pay attention - limited upside

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

Pair Corralation between Franklin Growth and Investment Managers

If you would invest (100.00) in Investment Managers Series on December 31, 2024 and sell it today you would earn a total of  100.00  from holding Investment Managers Series 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

Franklin Growth Opportunities  vs.  Investment Managers Series

Franklin Growth Oppo

Risk-Adjusted Performance

Very Weak

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

Investment Managers

Risk-Adjusted Performance

Very Weak

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

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

The idea behind Franklin Growth Opportunities and Investment Managers Series 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.