Correlation Between Altrius Global and Franklin International

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

By analyzing existing cross correlation between Altrius Global Dividend and Franklin International Core, you can compare the effects of market volatilities on Altrius Global and Franklin International 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 Altrius Global with a short position of Franklin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altrius Global and Franklin International.

Diversification Opportunities for Altrius Global and Franklin International

0.83

Correlation Coefficient

Altrius Global  Franklin International

Very poor diversification

The 3 months correlation between Altrius and Franklin is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Altrius Global Dividend and Franklin International Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin International and Altrius 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 Altrius Global Dividend are associated (or correlated) with Franklin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin International has no effect on the direction of Altrius Global i.e., Altrius Global and Franklin International go up and down completely randomly.

Pair Corralation between Altrius Global and Franklin International

Given the investment horizon of 90 days Altrius Global Dividend is expected to under-perform the Franklin International. But the etf apears to be less risky and, when comparing its historical volatility, Altrius Global Dividend is 1.21 times less risky than Franklin International. The etf trades about -0.33 of its potential returns per unit of risk. The Franklin International Core is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest  3,049  in Franklin International Core on September 22, 2024 and sell it today you would lose (68.00) from holding Franklin International Core or give up 2.23% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Altrius Global Dividend  vs.  Franklin International Core

Altrius Global Dividend

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Altrius Global Dividend has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Etf's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Franklin International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Franklin International Core has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Etf's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the Etf traders.

Pair Trading with Altrius Global and Franklin International

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

The idea behind Altrius Global Dividend and Franklin International Core 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.