Correlation Between Loomis Sayles and Templeton Global

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

By analyzing existing cross correlation between Loomis Sayles Strategic and Templeton Global Bond, you can compare the effects of market volatilities on Loomis Sayles and Templeton Global 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 Loomis Sayles with a short position of Templeton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Templeton Global.

Diversification Opportunities for Loomis Sayles and Templeton Global

0.39

Correlation Coefficient

Loomis Sayles  Templeton Global

Weak diversification

The 3 months correlation between Loomis and Templeton is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Strategic and Templeton Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Global Bond and Loomis Sayles 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 Loomis Sayles Strategic are associated (or correlated) with Templeton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Global Bond has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Templeton Global go up and down completely randomly.

Pair Corralation between Loomis Sayles and Templeton Global

Assuming the 90 days horizon Loomis Sayles Strategic is expected to generate 0.42 times more return on investment than Templeton Global. However, Loomis Sayles Strategic is 2.41 times less risky than Templeton Global. It trades about 0.09 of its potential returns per unit of risk. Templeton Global Bond is currently generating about -0.18 per unit of risk. If you would invest  1,233  in Loomis Sayles Strategic on September 5, 2024 and sell it today you would earn a total of  17.00  from holding Loomis Sayles Strategic or generate 1.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Loomis Sayles Strategic  vs.  Templeton Global Bond

Loomis Sayles Strategic

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Loomis Sayles Strategic are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Loomis Sayles is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Templeton Global Bond

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Templeton Global Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental drivers 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 Loomis Sayles and Templeton Global

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

The idea behind Loomis Sayles Strategic and Templeton Global Bond 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..