Correlation Between Franklin Resources and Blackstone
Can any of the company-specific risk be diversified away by investing in both Franklin Resources and Blackstone 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 Resources and Blackstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Resources and Blackstone Group, you can compare the effects of market volatilities on Franklin Resources and Blackstone 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 Resources with a short position of Blackstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Resources and Blackstone.
Diversification Opportunities for Franklin Resources and Blackstone
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Franklin and Blackstone is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Resources and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and Franklin Resources 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 Resources are associated (or correlated) with Blackstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Group has no effect on the direction of Franklin Resources i.e., Franklin Resources and Blackstone go up and down completely randomly.
Pair Corralation between Franklin Resources and Blackstone
Considering the 90-day investment horizon Franklin Resources is expected to generate 1.87 times less return on investment than Blackstone. But when comparing it to its historical volatility, Franklin Resources is 1.04 times less risky than Blackstone. It trades about 0.07 of its potential returns per unit of risk. Blackstone Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 9,124 in Blackstone Group on January 19, 2024 and sell it today you would earn a total of 2,908 from holding Blackstone Group or generate 31.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Franklin Resources vs. Blackstone Group
Performance |
| Timeline |
| Franklin Resources |
| Blackstone Group |
Franklin Resources and Blackstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Resources and Blackstone
The main advantage of trading using opposite Franklin Resources and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Resources position performs unexpectedly, Blackstone 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 Blackstone will offset losses from the drop in Blackstone's long position.| Franklin Resources vs. BlackRock | Franklin Resources vs. Main Street Capital | Franklin Resources vs. Blackstone Group | Franklin Resources vs. Ares Capital |
| Blackstone vs. T Rowe Price | Blackstone vs. State Street Corp | Blackstone vs. KKR Co LP | Blackstone vs. Brookfield Asset Management |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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