Correlation Between Sterling Capital and Putnam Focused
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Putnam Focused 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 Sterling Capital and Putnam Focused into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Focus and Putnam Focused Large, you can compare the effects of market volatilities on Sterling Capital and Putnam Focused 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 Sterling Capital with a short position of Putnam Focused. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Putnam Focused.
Diversification Opportunities for Sterling Capital and Putnam Focused
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sterling and Putnam is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Focus and Putnam Focused Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Focused Large and Sterling Capital 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 Sterling Capital Focus are associated (or correlated) with Putnam Focused. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Focused Large has no effect on the direction of Sterling Capital i.e., Sterling Capital and Putnam Focused go up and down completely randomly.
Pair Corralation between Sterling Capital and Putnam Focused
Considering the 90-day investment horizon Sterling Capital Focus is expected to generate 0.73 times more return on investment than Putnam Focused. However, Sterling Capital Focus is 1.36 times less risky than Putnam Focused. It trades about 0.31 of its potential returns per unit of risk. Putnam Focused Large is currently generating about 0.08 per unit of risk. If you would invest 3,044 in Sterling Capital Focus on November 9, 2024 and sell it today you would earn a total of 196.00 from holding Sterling Capital Focus or generate 6.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Focus vs. Putnam Focused Large
Performance |
| Timeline |
| Sterling Capital Focus |
| Putnam Focused Large |
Sterling Capital and Putnam Focused Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Putnam Focused
The main advantage of trading using opposite Sterling Capital and Putnam Focused positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Putnam Focused 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 Focused will offset losses from the drop in Putnam Focused's long position.| Sterling Capital vs. Absolute Core Strategy | Sterling Capital vs. iShares ESG Advanced | Sterling Capital vs. PIMCO RAFI Dynamic | Sterling Capital vs. HCM Defender 100 |
| Putnam Focused vs. Putnam Focused Large | Putnam Focused vs. Putnam Sustainable Future | Putnam Focused vs. Putnam Sustainable Leaders | Putnam Focused vs. Sterling Capital Focus |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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