Correlation Between Franklin High and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Franklin High and Goldman Sachs 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 High and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin High Yield and Goldman Sachs Tax Managed, you can compare the effects of market volatilities on Franklin High and Goldman Sachs 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 High with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Goldman Sachs.
Diversification Opportunities for Franklin High and Goldman Sachs
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Franklin and Goldman is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Yield and Goldman Sachs Tax Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Tax and Franklin High 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 High Yield are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Tax has no effect on the direction of Franklin High i.e., Franklin High and Goldman Sachs go up and down completely randomly.
Pair Corralation between Franklin High and Goldman Sachs
Assuming the 90 days horizon Franklin High Yield is expected to under-perform the Goldman Sachs. But the mutual fund apears to be less risky and, when comparing its historical volatility, Franklin High Yield is 2.66 times less risky than Goldman Sachs. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Goldman Sachs Tax Managed is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 4,482 in Goldman Sachs Tax Managed on September 15, 2024 and sell it today you would earn a total of 314.00 from holding Goldman Sachs Tax Managed or generate 7.01% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Franklin High Yield vs. Goldman Sachs Tax Managed
Performance |
Timeline |
Franklin High Yield |
Goldman Sachs Tax |
Franklin High and Goldman Sachs Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Franklin High and Goldman Sachs
The main advantage of trading using opposite Franklin High and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.Franklin High vs. Red Oak Technology | Franklin High vs. Leggmason Partners Institutional | Franklin High vs. Arrow Managed Futures | Franklin High vs. Balanced Fund Investor |
Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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