Correlation Between Glg Intl and George Putnam
Can any of the company-specific risk be diversified away by investing in both Glg Intl and George Putnam 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 Glg Intl and George Putnam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glg Intl Small and George Putnam Balanced, you can compare the effects of market volatilities on Glg Intl and George Putnam 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 Glg Intl with a short position of George Putnam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glg Intl and George Putnam.
Diversification Opportunities for Glg Intl and George Putnam
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Glg and George is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Glg Intl Small and George Putnam Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on George Putnam Balanced and Glg Intl 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 Glg Intl Small are associated (or correlated) with George Putnam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of George Putnam Balanced has no effect on the direction of Glg Intl i.e., Glg Intl and George Putnam go up and down completely randomly.
Pair Corralation between Glg Intl and George Putnam
Assuming the 90 days horizon Glg Intl Small is expected to generate 1.37 times more return on investment than George Putnam. However, Glg Intl is 1.37 times more volatile than George Putnam Balanced. It trades about 0.05 of its potential returns per unit of risk. George Putnam Balanced is currently generating about 0.05 per unit of risk. If you would invest 8,485 in Glg Intl Small on October 22, 2024 and sell it today you would earn a total of 68.00 from holding Glg Intl Small or generate 0.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glg Intl Small vs. George Putnam Balanced
Performance |
| Timeline |
| Glg Intl Small |
| George Putnam Balanced |
Glg Intl and George Putnam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glg Intl and George Putnam
The main advantage of trading using opposite Glg Intl and George Putnam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glg Intl position performs unexpectedly, George Putnam 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 George Putnam will offset losses from the drop in George Putnam's long position.| Glg Intl vs. Altegris Futures Evolution | Glg Intl vs. Ab Bond Inflation | Glg Intl vs. Lord Abbett Inflation | Glg Intl vs. Ab Bond Inflation |
| George Putnam vs. Blackrock Financial Institutions | George Putnam vs. 1919 Financial Services | George Putnam vs. Davis Financial Fund | George Putnam vs. Vanguard Financials Index |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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