Correlation Between Franklin Street and Yadkin Financial

Can any of the company-specific risk be diversified away by investing in both Franklin Street and Yadkin Financial 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 Street and Yadkin Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Franklin Street Properties and Yadkin Financial Corp, you can compare the effects of market volatilities on Franklin Street and Yadkin Financial 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 Street with a short position of Yadkin Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Street and Yadkin Financial.

Diversification Opportunities for Franklin Street and Yadkin Financial

0.0

Correlation Coefficient

Franklin Street  Yadkin Financial

Pay attention - limited upside

The 3 months correlation between Franklin and Yadkin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Street Properties and Yadkin Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yadkin Financial Corp and Franklin Street 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 Street Properties are associated (or correlated) with Yadkin Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yadkin Financial Corp has no effect on the direction of Franklin Street i.e., Franklin Street and Yadkin Financial go up and down completely randomly.

Pair Corralation between Franklin Street and Yadkin Financial

If you would invest  0.00  in Yadkin Financial Corp on February 4, 2024 and sell it today you would earn a total of  0.00  from holding Yadkin Financial Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.2%
Values	Daily Returns

Franklin Street Properties  vs.  Yadkin Financial Corp

Franklin Street Prop

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Franklin Street Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in June 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Yadkin Financial Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yadkin Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward-looking signals, Yadkin Financial is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Franklin Street and Yadkin Financial

The main advantage of trading using opposite Franklin Street and Yadkin Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Street position performs unexpectedly, Yadkin Financial 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 Yadkin Financial will offset losses from the drop in Yadkin Financial's long position.

The idea behind Franklin Street Properties and Yadkin Financial Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.