Correlation Between NYSE Composite and Putnam Managed
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Putnam Managed 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 NYSE Composite and Putnam Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Putnam Managed Municipal, you can compare the effects of market volatilities on NYSE Composite and Putnam Managed 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 NYSE Composite with a short position of Putnam Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Putnam Managed.
Diversification Opportunities for NYSE Composite and Putnam Managed
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and Putnam is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Putnam Managed Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Managed Municipal and NYSE Composite 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 NYSE Composite are associated (or correlated) with Putnam Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Managed Municipal has no effect on the direction of NYSE Composite i.e., NYSE Composite and Putnam Managed go up and down completely randomly.
Pair Corralation between NYSE Composite and Putnam Managed
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.01 times more return on investment than Putnam Managed. However, NYSE Composite is 1.01 times more volatile than Putnam Managed Municipal. It trades about 0.13 of its potential returns per unit of risk. Putnam Managed Municipal is currently generating about -0.14 per unit of risk. If you would invest 1,959,424 in NYSE Composite on August 24, 2024 and sell it today you would earn a total of 37,406 from holding NYSE Composite or generate 1.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Putnam Managed Municipal
Performance |
| Timeline |
NYSE Composite and Putnam Managed Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Putnam Managed Municipal
Pair trading matchups for Putnam Managed
Pair Trading with NYSE Composite and Putnam Managed
The main advantage of trading using opposite NYSE Composite and Putnam Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Putnam Managed 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 Managed will offset losses from the drop in Putnam Managed's long position.| NYSE Composite vs. Akanda Corp | NYSE Composite vs. Valneva SE ADR | NYSE Composite vs. Radcom | NYSE Composite vs. Western Digital |
| Putnam Managed vs. MFS Investment Grade | Putnam Managed vs. Eaton Vance National | Putnam Managed vs. Blackrock Munivest | Putnam Managed vs. DTF Tax Free |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |