Correlation Between Jpmorgan Income and Franklin Strategic
Can any of the company-specific risk be diversified away by investing in both Jpmorgan Income and Franklin Strategic 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 Jpmorgan Income and Franklin Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jpmorgan Income Fund and Franklin Strategic Income, you can compare the effects of market volatilities on Jpmorgan Income and Franklin Strategic 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 Jpmorgan Income with a short position of Franklin Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Income and Franklin Strategic.
Diversification Opportunities for Jpmorgan Income and Franklin Strategic
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jpmorgan and Franklin is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Income Fund and Franklin Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Strategic and Jpmorgan Income 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 Jpmorgan Income Fund are associated (or correlated) with Franklin Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Strategic has no effect on the direction of Jpmorgan Income i.e., Jpmorgan Income and Franklin Strategic go up and down completely randomly.
Pair Corralation between Jpmorgan Income and Franklin Strategic
Assuming the 90 days horizon Jpmorgan Income Fund is expected to generate 0.81 times more return on investment than Franklin Strategic. However, Jpmorgan Income Fund is 1.23 times less risky than Franklin Strategic. It trades about -0.12 of its potential returns per unit of risk. Franklin Strategic Income is currently generating about -0.32 per unit of risk. If you would invest 834.00 in Jpmorgan Income Fund on January 24, 2024 and sell it today you would lose (4.00) from holding Jpmorgan Income Fund or give up 0.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jpmorgan Income Fund vs. Franklin Strategic Income
Performance |
| Timeline |
| Jpmorgan Me Fund |
| Franklin Strategic |
Jpmorgan Income and Franklin Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jpmorgan Income and Franklin Strategic
The main advantage of trading using opposite Jpmorgan Income and Franklin Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jpmorgan Income position performs unexpectedly, Franklin Strategic 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 Strategic will offset losses from the drop in Franklin Strategic's long position.| Jpmorgan Income vs. Jpmorgan Smartretirement 2035 | Jpmorgan Income vs. Jpmorgan Smartretirement 2035 | Jpmorgan Income vs. Jpmorgan Smartretirement 2035 | Jpmorgan Income vs. Jpmorgan Smartretirement 2035 |
| Franklin Strategic vs. Franklin Mutual Beacon | Franklin Strategic vs. Templeton Developing Markets | Franklin Strategic vs. Franklin Mutual Global | Franklin Strategic vs. Franklin Mutual Global |
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 Stocks Directory module to find actively traded stocks across global markets.
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