Correlation Between Putnam High and Empiric 2500
Can any of the company-specific risk be diversified away by investing in both Putnam High and Empiric 2500 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 High and Empiric 2500 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam High Income and Empiric 2500 Fund, you can compare the effects of market volatilities on Putnam High and Empiric 2500 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 High with a short position of Empiric 2500. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam High and Empiric 2500.
Diversification Opportunities for Putnam High and Empiric 2500
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Putnam and Empiric is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Putnam High Income and Empiric 2500 Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Empiric 2500 and Putnam High 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 High Income are associated (or correlated) with Empiric 2500. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Empiric 2500 has no effect on the direction of Putnam High i.e., Putnam High and Empiric 2500 go up and down completely randomly.
Pair Corralation between Putnam High and Empiric 2500
Considering the 90-day investment horizon Putnam High Income is expected to generate 0.72 times more return on investment than Empiric 2500. However, Putnam High Income is 1.38 times less risky than Empiric 2500. It trades about 0.29 of its potential returns per unit of risk. Empiric 2500 Fund is currently generating about -0.15 per unit of risk. If you would invest 656.00 in Putnam High Income on November 29, 2024 and sell it today you would earn a total of 25.00 from holding Putnam High Income or generate 3.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam High Income vs. Empiric 2500 Fund
Performance |
| Timeline |
| Putnam High Income |
| Empiric 2500 |
Putnam High and Empiric 2500 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam High and Empiric 2500
The main advantage of trading using opposite Putnam High and Empiric 2500 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam High position performs unexpectedly, Empiric 2500 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 Empiric 2500 will offset losses from the drop in Empiric 2500's long position.| Putnam High vs. RiverNorthDoubleLine Strategic Opportunity | Putnam High vs. Cornerstone Strategic Return | Putnam High vs. Oxford Lane Capital | Putnam High vs. Horizon Technology Finance |
| Empiric 2500 vs. The Hartford International | Empiric 2500 vs. L Mason Qs | Empiric 2500 vs. Small Pany Growth | Empiric 2500 vs. Templeton Growth Fund |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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