Correlation Between Quantitative Longshort and Putman Absolute
Can any of the company-specific risk be diversified away by investing in both Quantitative Longshort and Putman Absolute 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 Quantitative Longshort and Putman Absolute into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quantitative Longshort Equity and Putman Absolute Return, you can compare the effects of market volatilities on Quantitative Longshort and Putman Absolute 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 Quantitative Longshort with a short position of Putman Absolute. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quantitative Longshort and Putman Absolute.
Diversification Opportunities for Quantitative Longshort and Putman Absolute
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Quantitative and Putman is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Quantitative Longshort Equity and Putman Absolute Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putman Absolute Return and Quantitative Longshort 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 Quantitative Longshort Equity are associated (or correlated) with Putman Absolute. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putman Absolute Return has no effect on the direction of Quantitative Longshort i.e., Quantitative Longshort and Putman Absolute go up and down completely randomly.
Pair Corralation between Quantitative Longshort and Putman Absolute
Assuming the 90 days horizon Quantitative Longshort Equity is expected to generate 1.4 times more return on investment than Putman Absolute. However, Quantitative Longshort is 1.4 times more volatile than Putman Absolute Return. It trades about 0.21 of its potential returns per unit of risk. Putman Absolute Return is currently generating about -0.1 per unit of risk. If you would invest 1,397 in Quantitative Longshort Equity on September 12, 2024 and sell it today you would earn a total of 79.00 from holding Quantitative Longshort Equity or generate 5.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quantitative Longshort Equity vs. Putman Absolute Return
Performance |
| Timeline |
| Quantitative Longshort |
| Putman Absolute Return |
Quantitative Longshort and Putman Absolute Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quantitative Longshort and Putman Absolute
The main advantage of trading using opposite Quantitative Longshort and Putman Absolute positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quantitative Longshort position performs unexpectedly, Putman Absolute 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 Putman Absolute will offset losses from the drop in Putman Absolute's long position.| Quantitative Longshort vs. Neuberger Berman Long | Quantitative Longshort vs. Neuberger Berman Long | Quantitative Longshort vs. Neuberger Berman Long | Quantitative Longshort vs. Aqr Long Short Equity |
| Putman Absolute vs. SCOR PK | Putman Absolute vs. Morningstar Unconstrained Allocation | Putman Absolute vs. Via Renewables | Putman Absolute vs. Bondbloxx ETF Trust |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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