Correlation Between Putnam Dynamic and Putnam Growth
Can any of the company-specific risk be diversified away by investing in both Putnam Dynamic and Putnam Growth 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 Putnam Dynamic and Putnam Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Dynamic Asset and Putnam Growth Opportunities, you can compare the effects of market volatilities on Putnam Dynamic and Putnam Growth 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 Putnam Dynamic with a short position of Putnam Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Dynamic and Putnam Growth.
Diversification Opportunities for Putnam Dynamic and Putnam Growth
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Putnam and Putnam is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Dynamic Asset and Putnam Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Growth Opport and Putnam Dynamic 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 Putnam Dynamic Asset are associated (or correlated) with Putnam Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Growth Opport has no effect on the direction of Putnam Dynamic i.e., Putnam Dynamic and Putnam Growth go up and down completely randomly.
Pair Corralation between Putnam Dynamic and Putnam Growth
Assuming the 90 days horizon Putnam Dynamic is expected to generate 3.38 times less return on investment than Putnam Growth. But when comparing it to its historical volatility, Putnam Dynamic Asset is 2.0 times less risky than Putnam Growth. It trades about 0.13 of its potential returns per unit of risk. Putnam Growth Opportunities is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 7,466 in Putnam Growth Opportunities on September 12, 2024 and sell it today you would earn a total of 330.00 from holding Putnam Growth Opportunities or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Dynamic Asset vs. Putnam Growth Opportunities
Performance |
| Timeline |
| Putnam Dynamic Asset |
| Putnam Growth Opport |
Putnam Dynamic and Putnam Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Dynamic and Putnam Growth
The main advantage of trading using opposite Putnam Dynamic and Putnam Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Dynamic position performs unexpectedly, Putnam Growth 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 Growth will offset losses from the drop in Putnam Growth's long position.| Putnam Dynamic vs. Goldman Sachs Technology | Putnam Dynamic vs. Pgim Jennison Technology | Putnam Dynamic vs. Vanguard Information Technology | Putnam Dynamic vs. Fidelity Advisor Technology |
| Putnam Growth vs. Needham Aggressive Growth | Putnam Growth vs. Champlain Mid Cap | Putnam Growth vs. L Abbett Growth | Putnam Growth vs. Tfa Alphagen Growth |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |