Correlation Between Mfs Porate and Putnam Convertible
Can any of the company-specific risk be diversified away by investing in both Mfs Porate and Putnam Convertible 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 Mfs Porate and Putnam Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Porate Bond and Putnam Convertible Securities, you can compare the effects of market volatilities on Mfs Porate and Putnam Convertible 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 Mfs Porate with a short position of Putnam Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Porate and Putnam Convertible.
Diversification Opportunities for Mfs Porate and Putnam Convertible
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mfs and Putnam is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Porate Bond and Putnam Convertible Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Convertible and Mfs Porate 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 Mfs Porate Bond are associated (or correlated) with Putnam Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Convertible has no effect on the direction of Mfs Porate i.e., Mfs Porate and Putnam Convertible go up and down completely randomly.
Pair Corralation between Mfs Porate and Putnam Convertible
Assuming the 90 days horizon Mfs Porate is expected to generate 6.34 times less return on investment than Putnam Convertible. But when comparing it to its historical volatility, Mfs Porate Bond is 2.12 times less risky than Putnam Convertible. It trades about 0.07 of its potential returns per unit of risk. Putnam Convertible Securities is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 2,572 in Putnam Convertible Securities on November 2, 2024 and sell it today you would earn a total of 68.00 from holding Putnam Convertible Securities or generate 2.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Porate Bond vs. Putnam Convertible Securities
Performance |
| Timeline |
| Mfs Porate Bond |
| Putnam Convertible |
Mfs Porate and Putnam Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Porate and Putnam Convertible
The main advantage of trading using opposite Mfs Porate and Putnam Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Porate position performs unexpectedly, Putnam Convertible 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 Convertible will offset losses from the drop in Putnam Convertible's long position.| Mfs Porate vs. Putnam Convertible Securities | Mfs Porate vs. Rationalpier 88 Convertible | Mfs Porate vs. Gabelli Convertible And | Mfs Porate vs. Calamos Dynamic Convertible |
| Putnam Convertible vs. Ab Bond Inflation | Putnam Convertible vs. Artisan High Income | Putnam Convertible vs. Dreyfusstandish Global Fixed | Putnam Convertible vs. Bbh Intermediate Municipal |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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