Correlation Between Putnam Retirement and Barings Us
Can any of the company-specific risk be diversified away by investing in both Putnam Retirement and Barings Us 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 Us 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 High Yield, you can compare the effects of market volatilities on Putnam Retirement and Barings Us 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 Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Retirement and Barings Us.
Diversification Opportunities for Putnam Retirement and Barings Us
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Putnam and Barings is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Retirement Advantage and Barings High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings High Yield 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 Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings High Yield has no effect on the direction of Putnam Retirement i.e., Putnam Retirement and Barings Us go up and down completely randomly.
Pair Corralation between Putnam Retirement and Barings Us
Assuming the 90 days horizon Putnam Retirement Advantage is expected to under-perform the Barings Us. In addition to that, Putnam Retirement is 8.95 times more volatile than Barings High Yield. It trades about -0.25 of its total potential returns per unit of risk. Barings High Yield is currently generating about -0.36 per unit of volatility. If you would invest 821.00 in Barings High Yield on October 11, 2024 and sell it today you would lose (10.00) from holding Barings High Yield or give up 1.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Putnam Retirement Advantage vs. Barings High Yield
Performance |
| Timeline |
| Putnam Retirement |
| Barings High Yield |
Putnam Retirement and Barings Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Retirement and Barings Us
The main advantage of trading using opposite Putnam Retirement and Barings Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Retirement position performs unexpectedly, Barings Us 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 Us will offset losses from the drop in Barings Us' long position.| Putnam Retirement vs. Barings High Yield | Putnam Retirement vs. Fidelity Focused High | Putnam Retirement vs. Needham Aggressive Growth | Putnam Retirement vs. Millerhoward High Income |
| Barings Us vs. Amg Managers Centersquare | Barings Us vs. Jhancock Real Estate | Barings Us vs. Nexpoint Real Estate | Barings Us vs. Redwood Real Estate |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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