Correlation Between Lord Abbett and Franklin Floating

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

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

Diversification Opportunities for Lord Abbett and Franklin Floating

0.0

Correlation Coefficient

Lord Abbett  Franklin Floating

Pay attention - limited upside

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

Pair Corralation between Lord Abbett and Franklin Floating

If you would invest  1,574  in Franklin Floating Rate on September 30, 2024 and sell it today you would earn a total of  27.00  from holding Franklin Floating Rate or generate 1.72% return on investment over 90 days.

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

Lord Abbett Multi  vs.  Franklin Floating Rate

Lord Abbett Multi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lord Abbett Multi has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Lord Abbett is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Franklin Floating Rate

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Franklin Floating Rate are ranked lower than 20 (%) 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.

Pair Trading with Lord Abbett and Franklin Floating

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

The idea behind Lord Abbett Multi and Franklin Floating Rate 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.