Correlation Between Templeton Global and PAR Technology
Can any of the company-specific risk be diversified away by investing in both Templeton Global and PAR Technology 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 Templeton Global and PAR Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Global Balanced and PAR Technology, you can compare the effects of market volatilities on Templeton Global and PAR Technology 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 Templeton Global with a short position of PAR Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Global and PAR Technology.
Diversification Opportunities for Templeton Global and PAR Technology
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Templeton and PAR is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Global Balanced and PAR Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PAR Technology and Templeton Global 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 Templeton Global Balanced are associated (or correlated) with PAR Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PAR Technology has no effect on the direction of Templeton Global i.e., Templeton Global and PAR Technology go up and down completely randomly.
Pair Corralation between Templeton Global and PAR Technology
Assuming the 90 days horizon Templeton Global Balanced is expected to generate 0.3 times more return on investment than PAR Technology. However, Templeton Global Balanced is 3.37 times less risky than PAR Technology. It trades about -0.16 of its potential returns per unit of risk. PAR Technology is currently generating about -0.07 per unit of risk. If you would invest 246.00 in Templeton Global Balanced on January 24, 2024 and sell it today you would lose (5.00) from holding Templeton Global Balanced or give up 2.03% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Templeton Global Balanced vs. PAR Technology
Performance |
Timeline |
Templeton Global Balanced |
PAR Technology |
Templeton Global and PAR Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Templeton Global and PAR Technology
The main advantage of trading using opposite Templeton Global and PAR Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Global position performs unexpectedly, PAR Technology 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 PAR Technology will offset losses from the drop in PAR Technology's long position.Templeton Global vs. Franklin Mutual Beacon | Templeton Global vs. Templeton Developing Markets | Templeton Global vs. Franklin Mutual Global | Templeton Global vs. Franklin Mutual Global |
PAR Technology vs. Model N | PAR Technology vs. CS Disco LLC | PAR Technology vs. Powerschool Holdings | PAR Technology vs. PROS Holdings |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |