Correlation Between Barings Emerging and Putnam Tax
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Putnam Tax 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 Barings Emerging and Putnam Tax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Emerging Markets and Putnam Tax Exempt, you can compare the effects of market volatilities on Barings Emerging and Putnam Tax 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 Barings Emerging with a short position of Putnam Tax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Putnam Tax.
Diversification Opportunities for Barings Emerging and Putnam Tax
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barings and Putnam is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Putnam Tax Exempt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Tax Exempt and Barings Emerging 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 Barings Emerging Markets are associated (or correlated) with Putnam Tax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Tax Exempt has no effect on the direction of Barings Emerging i.e., Barings Emerging and Putnam Tax go up and down completely randomly.
Pair Corralation between Barings Emerging and Putnam Tax
Assuming the 90 days horizon Barings Emerging is expected to generate 1.13 times less return on investment than Putnam Tax. In addition to that, Barings Emerging is 1.35 times more volatile than Putnam Tax Exempt. It trades about 0.08 of its total potential returns per unit of risk. Putnam Tax Exempt is currently generating about 0.12 per unit of volatility. If you would invest 765.00 in Putnam Tax Exempt on September 2, 2024 and sell it today you would earn a total of 31.00 from holding Putnam Tax Exempt or generate 4.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Putnam Tax Exempt
Performance |
| Timeline |
| Barings Emerging Markets |
| Putnam Tax Exempt |
Barings Emerging and Putnam Tax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Putnam Tax
The main advantage of trading using opposite Barings Emerging and Putnam Tax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Putnam Tax 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 Tax will offset losses from the drop in Putnam Tax's long position.| Barings Emerging vs. Vy Goldman Sachs | Barings Emerging vs. Oppenheimer Gold Special | Barings Emerging vs. Gabelli Gold Fund | Barings Emerging vs. James Balanced Golden |
| Putnam Tax vs. American Century Investment | Putnam Tax vs. Meeder Funds | Putnam Tax vs. Prudential Government Money | Putnam Tax vs. John Hancock Money |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |