Correlation Between Franklin Emerging and Federated Mdt
Can any of the company-specific risk be diversified away by investing in both Franklin Emerging and Federated Mdt 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 Emerging and Federated Mdt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Emerging Market and Federated Mdt Large, you can compare the effects of market volatilities on Franklin Emerging and Federated Mdt 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 Emerging with a short position of Federated Mdt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Emerging and Federated Mdt.
Diversification Opportunities for Franklin Emerging and Federated Mdt
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Federated is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Emerging Market and Federated Mdt Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Mdt Large and Franklin Emerging 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 Emerging Market are associated (or correlated) with Federated Mdt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Mdt Large has no effect on the direction of Franklin Emerging i.e., Franklin Emerging and Federated Mdt go up and down completely randomly.
Pair Corralation between Franklin Emerging and Federated Mdt
Assuming the 90 days horizon Franklin Emerging Market is expected to generate 0.23 times more return on investment than Federated Mdt. However, Franklin Emerging Market is 4.29 times less risky than Federated Mdt. It trades about 0.52 of its potential returns per unit of risk. Federated Mdt Large is currently generating about 0.04 per unit of risk. If you would invest 1,233 in Franklin Emerging Market on May 28, 2025 and sell it today you would earn a total of 21.00 from holding Franklin Emerging Market or generate 1.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Emerging Market vs. Federated Mdt Large
Performance |
| Timeline |
| Franklin Emerging Market |
| Federated Mdt Large |
Franklin Emerging and Federated Mdt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Emerging and Federated Mdt
The main advantage of trading using opposite Franklin Emerging and Federated Mdt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Emerging position performs unexpectedly, Federated Mdt 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 Federated Mdt will offset losses from the drop in Federated Mdt's long position.| Franklin Emerging vs. Franklin Mutual Beacon | Franklin Emerging vs. Templeton Developing Markets | Franklin Emerging vs. Franklin Mutual Global | Franklin Emerging vs. Franklin Mutual Global |
| Federated Mdt vs. Tiaa Cref Life Money | Federated Mdt vs. Profunds Money | Federated Mdt vs. Money Market Obligations | Federated Mdt vs. Ab Government Exchange |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |