Correlation Between Invesco Gold and Putnam Floating
Can any of the company-specific risk be diversified away by investing in both Invesco Gold and Putnam Floating 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 Invesco Gold and Putnam Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Gold Special and Putnam Floating Rate, you can compare the effects of market volatilities on Invesco Gold and Putnam Floating 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 Invesco Gold with a short position of Putnam Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Gold and Putnam Floating.
Diversification Opportunities for Invesco Gold and Putnam Floating
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Invesco and Putnam is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Gold Special and Putnam Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Floating Rate and Invesco Gold 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 Invesco Gold Special are associated (or correlated) with Putnam Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Floating Rate has no effect on the direction of Invesco Gold i.e., Invesco Gold and Putnam Floating go up and down completely randomly.
Pair Corralation between Invesco Gold and Putnam Floating
Assuming the 90 days horizon Invesco Gold Special is expected to generate 9.03 times more return on investment than Putnam Floating. However, Invesco Gold is 9.03 times more volatile than Putnam Floating Rate. It trades about 0.04 of its potential returns per unit of risk. Putnam Floating Rate is currently generating about 0.19 per unit of risk. If you would invest 2,264 in Invesco Gold Special on September 4, 2024 and sell it today you would earn a total of 562.00 from holding Invesco Gold Special or generate 24.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Invesco Gold Special vs. Putnam Floating Rate
Performance |
| Timeline |
| Invesco Gold Special |
| Putnam Floating Rate |
Invesco Gold and Putnam Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Gold and Putnam Floating
The main advantage of trading using opposite Invesco Gold and Putnam Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Gold position performs unexpectedly, Putnam Floating 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 Floating will offset losses from the drop in Putnam Floating's long position.| Invesco Gold vs. Massmutual Select Diversified | Invesco Gold vs. Ep Emerging Markets | Invesco Gold vs. Fundvantage Trust | Invesco Gold vs. Legg Mason Partners |
| Putnam Floating vs. Putnam Equity Income | Putnam Floating vs. Putnam Tax Exempt | Putnam Floating vs. Putnam Floating Rate | Putnam Floating vs. Putnam High Yield |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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