Correlation Between Amg River and Putnam Global
Can any of the company-specific risk be diversified away by investing in both Amg River and Putnam Global 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 Amg River and Putnam Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg River Road and Putnam Global Financials, you can compare the effects of market volatilities on Amg River and Putnam Global 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 Amg River with a short position of Putnam Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg River and Putnam Global.
Diversification Opportunities for Amg River and Putnam Global
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amg and Putnam is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Amg River Road and Putnam Global Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Global Financials and Amg River 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 Amg River Road are associated (or correlated) with Putnam Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Global Financials has no effect on the direction of Amg River i.e., Amg River and Putnam Global go up and down completely randomly.
Pair Corralation between Amg River and Putnam Global
Assuming the 90 days horizon Amg River Road is expected to generate 1.35 times more return on investment than Putnam Global. However, Amg River is 1.35 times more volatile than Putnam Global Financials. It trades about 0.3 of its potential returns per unit of risk. Putnam Global Financials is currently generating about 0.09 per unit of risk. If you would invest 957.00 in Amg River Road on October 24, 2024 and sell it today you would earn a total of 31.00 from holding Amg River Road or generate 3.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg River Road vs. Putnam Global Financials
Performance |
| Timeline |
| Amg River Road |
| Putnam Global Financials |
Amg River and Putnam Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg River and Putnam Global
The main advantage of trading using opposite Amg River and Putnam Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg River position performs unexpectedly, Putnam Global 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 Global will offset losses from the drop in Putnam Global's long position.| Amg River vs. Amg River Road | Amg River vs. Champlain Small Pany | Amg River vs. Amg River Road | Amg River vs. Marsico Global Fund |
| Putnam Global vs. Mutual Of America | Putnam Global vs. Small Cap Growth Profund | Putnam Global vs. Amg River Road | Putnam Global vs. Great West Loomis Sayles |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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