Correlation Between Franklin Government and Seafarer Overseas
Can any of the company-specific risk be diversified away by investing in both Franklin Government and Seafarer Overseas 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 Government and Seafarer Overseas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Government Securities and Seafarer Overseas Growth, you can compare the effects of market volatilities on Franklin Government and Seafarer Overseas 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 Government with a short position of Seafarer Overseas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Government and Seafarer Overseas.
Diversification Opportunities for Franklin Government and Seafarer Overseas
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Franklin Government and Seafarer is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Government Securities and Seafarer Overseas Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seafarer Overseas Growth and Franklin Government 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 Government Securities are associated (or correlated) with Seafarer Overseas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seafarer Overseas Growth has no effect on the direction of Franklin Government i.e., Franklin Government and Seafarer Overseas go up and down completely randomly.
Pair Corralation between Franklin Government and Seafarer Overseas
Assuming the 90 days horizon Franklin Government is expected to generate 10.2 times less return on investment than Seafarer Overseas. But when comparing it to its historical volatility, Franklin Government Securities is 1.8 times less risky than Seafarer Overseas. It trades about 0.06 of its potential returns per unit of risk. Seafarer Overseas Growth is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 1,208 in Seafarer Overseas Growth on April 24, 2025 and sell it today you would earn a total of 131.00 from holding Seafarer Overseas Growth or generate 10.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Government Securities vs. Seafarer Overseas Growth
Performance |
| Timeline |
| Franklin Government |
| Seafarer Overseas Growth |
Franklin Government and Seafarer Overseas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Government and Seafarer Overseas
The main advantage of trading using opposite Franklin Government and Seafarer Overseas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Government position performs unexpectedly, Seafarer Overseas 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 Seafarer Overseas will offset losses from the drop in Seafarer Overseas' long position.| Franklin Government vs. Janus Global Allocation | Franklin Government vs. T Rowe Price | Franklin Government vs. Voya Target Retirement | Franklin Government vs. Tiaa Cref Lifestyle Servative |
| Seafarer Overseas vs. Rbc Emerging Markets | Seafarer Overseas vs. Sa Emerging Markets | Seafarer Overseas vs. Blackrock Emerging Markets | Seafarer Overseas vs. Calvert Emerging Markets |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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