Correlation Between Okta and Putnam Short
Can any of the company-specific risk be diversified away by investing in both Okta and Putnam Short 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 Okta and Putnam Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Putnam Short Duration, you can compare the effects of market volatilities on Okta and Putnam Short 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 Okta with a short position of Putnam Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Putnam Short.
Diversification Opportunities for Okta and Putnam Short
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Okta and Putnam is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Putnam Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Short Duration and Okta 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 Okta Inc are associated (or correlated) with Putnam Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Short Duration has no effect on the direction of Okta i.e., Okta and Putnam Short go up and down completely randomly.
Pair Corralation between Okta and Putnam Short
Given the investment horizon of 90 days Okta Inc is expected to generate 19.31 times more return on investment than Putnam Short. However, Okta is 19.31 times more volatile than Putnam Short Duration. It trades about 0.12 of its potential returns per unit of risk. Putnam Short Duration is currently generating about 0.2 per unit of risk. If you would invest 7,325 in Okta Inc on August 28, 2024 and sell it today you would earn a total of 325.00 from holding Okta Inc or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Okta Inc vs. Putnam Short Duration
Performance |
| Timeline |
| Okta Inc |
| Putnam Short Duration |
Okta and Putnam Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Putnam Short
The main advantage of trading using opposite Okta and Putnam Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Putnam Short 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 Short will offset losses from the drop in Putnam Short's long position.The idea behind Okta Inc and Putnam Short Duration pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Putnam Short vs. Fidelity Sai Inflationfocused | Putnam Short vs. Loomis Sayles Inflation | Putnam Short vs. Ab Municipal Bond | Putnam Short vs. Tiaa Cref Inflation Link |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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