Correlation Between Franklin Floating and Nordnet Teknologi

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

By analyzing existing cross correlation between Franklin Floating Rate and Nordnet Teknologi Indeks, you can compare the effects of market volatilities on Franklin Floating and Nordnet Teknologi 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 Floating with a short position of Nordnet Teknologi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Floating and Nordnet Teknologi.

Diversification Opportunities for Franklin Floating and Nordnet Teknologi

0.0

Correlation Coefficient

Franklin Floating  Nordnet Teknologi

Pay attention - limited upside

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

Pair Corralation between Franklin Floating and Nordnet Teknologi

If you would invest  1,828  in Franklin Floating Rate on October 25, 2024 and sell it today you would earn a total of  32.00  from holding Franklin Floating Rate or generate 1.75% return on investment over 90 days.

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

Franklin Floating Rate  vs.  Nordnet Teknologi Indeks

Franklin Floating Rate

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Franklin Floating Rate are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong fundamental indicators, Franklin Floating is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Nordnet Teknologi Indeks

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nordnet Teknologi Indeks are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of very weak primary indicators, Nordnet Teknologi may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Franklin Floating and Nordnet Teknologi

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

The idea behind Franklin Floating Rate and Nordnet Teknologi Indeks 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.