Correlation Between Putnam Retirement and Barings Emerging
Can any of the company-specific risk be diversified away by investing in both Putnam Retirement and Barings Emerging 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 Retirement and Barings Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Retirement Advantage and Barings Emerging Markets, you can compare the effects of market volatilities on Putnam Retirement and Barings Emerging 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 Retirement with a short position of Barings Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Retirement and Barings Emerging.
Diversification Opportunities for Putnam Retirement and Barings Emerging
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Putnam and Barings is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Retirement Advantage and Barings Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Emerging Markets and Putnam Retirement 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 Retirement Advantage are associated (or correlated) with Barings Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Emerging Markets has no effect on the direction of Putnam Retirement i.e., Putnam Retirement and Barings Emerging go up and down completely randomly.
Pair Corralation between Putnam Retirement and Barings Emerging
Assuming the 90 days horizon Putnam Retirement is expected to generate 1.34 times less return on investment than Barings Emerging. In addition to that, Putnam Retirement is 3.08 times more volatile than Barings Emerging Markets. It trades about 0.08 of its total potential returns per unit of risk. Barings Emerging Markets is currently generating about 0.33 per unit of volatility. If you would invest 743.00 in Barings Emerging Markets on October 28, 2024 and sell it today you would earn a total of 13.00 from holding Barings Emerging Markets or generate 1.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Retirement Advantage vs. Barings Emerging Markets
Performance |
| Timeline |
| Putnam Retirement |
| Barings Emerging Markets |
Putnam Retirement and Barings Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Retirement and Barings Emerging
The main advantage of trading using opposite Putnam Retirement and Barings Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Retirement position performs unexpectedly, Barings Emerging 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 Barings Emerging will offset losses from the drop in Barings Emerging's long position.| Putnam Retirement vs. Tiaa Cref High Yield Fund | Putnam Retirement vs. Artisan High Income | Putnam Retirement vs. Fidelity Capital Income | Putnam Retirement vs. Victory High Yield |
| Barings Emerging vs. Lsv Small Cap | Barings Emerging vs. American Century Etf | Barings Emerging vs. Small Cap Value | Barings Emerging vs. Applied Finance Explorer |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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