Correlation Between Ab Bond and Putnam Money
Can any of the company-specific risk be diversified away by investing in both Ab Bond and Putnam Money 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 Bond and Putnam Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Bond Inflation and Putnam Money Market, you can compare the effects of market volatilities on Ab Bond and Putnam Money 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 Bond with a short position of Putnam Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and Putnam Money.
Diversification Opportunities for Ab Bond and Putnam Money
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ANBIX and Putnam is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and Putnam Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Money Market and Ab Bond 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 Bond Inflation are associated (or correlated) with Putnam Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Money Market has no effect on the direction of Ab Bond i.e., Ab Bond and Putnam Money go up and down completely randomly.
Pair Corralation between Ab Bond and Putnam Money
Assuming the 90 days horizon Ab Bond is expected to generate 1.05 times less return on investment than Putnam Money. But when comparing it to its historical volatility, Ab Bond Inflation is 2.39 times less risky than Putnam Money. It trades about 0.07 of its potential returns per unit of risk. Putnam Money Market is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 92.00 in Putnam Money Market on November 7, 2024 and sell it today you would earn a total of 8.00 from holding Putnam Money Market or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Ab Bond Inflation vs. Putnam Money Market
Performance |
| Timeline |
| Ab Bond Inflation |
| Putnam Money Market |
Ab Bond and Putnam Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and Putnam Money
The main advantage of trading using opposite Ab Bond and Putnam Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, Putnam Money 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 Money will offset losses from the drop in Putnam Money's long position.| Ab Bond vs. Global Technology Portfolio | Ab Bond vs. Goldman Sachs Technology | Ab Bond vs. Red Oak Technology | Ab Bond vs. Allianzgi Technology Fund |
| Putnam Money vs. Hennessy Nerstone Mid | Putnam Money vs. Heartland Value Plus | Putnam Money vs. Ultrasmall Cap Profund Ultrasmall Cap | Putnam Money vs. Small Cap Value |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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