Correlation Between Ab Value and Putnam Growth
Can any of the company-specific risk be diversified away by investing in both Ab Value and Putnam Growth 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 Ab Value and Putnam Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Value Fund and Putnam Growth Opportunities, you can compare the effects of market volatilities on Ab Value and Putnam Growth 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 Ab Value with a short position of Putnam Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Value and Putnam Growth.
Diversification Opportunities for Ab Value and Putnam Growth
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ABVCX and Putnam is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund and Putnam Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Growth Opport and Ab Value 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 Ab Value Fund are associated (or correlated) with Putnam Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Growth Opport has no effect on the direction of Ab Value i.e., Ab Value and Putnam Growth go up and down completely randomly.
Pair Corralation between Ab Value and Putnam Growth
Assuming the 90 days horizon Ab Value Fund is expected to under-perform the Putnam Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ab Value Fund is 1.64 times less risky than Putnam Growth. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Putnam Growth Opportunities is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 6,404 in Putnam Growth Opportunities on September 13, 2024 and sell it today you would earn a total of 265.00 from holding Putnam Growth Opportunities or generate 4.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ab Value Fund vs. Putnam Growth Opportunities
Performance |
| Timeline |
| Ab Value Fund |
| Putnam Growth Opport |
Ab Value and Putnam Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Value and Putnam Growth
The main advantage of trading using opposite Ab Value and Putnam Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Value position performs unexpectedly, Putnam Growth 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 Putnam Growth will offset losses from the drop in Putnam Growth's long position.| Ab Value vs. Franklin Adjustable Government | Ab Value vs. Us Government Securities | Ab Value vs. Lord Abbett Government | Ab Value vs. Dunham Porategovernment Bond |
| Putnam Growth vs. Putnam Equity Income | Putnam Growth vs. Putnam Tax Exempt | Putnam Growth vs. Putnam Floating Rate | Putnam Growth vs. Putnam High Yield |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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