Correlation Between Putnam High and Ladenburg Growth
Can any of the company-specific risk be diversified away by investing in both Putnam High and Ladenburg 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 High and Ladenburg Growth 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 Ladenburg Growth Income, you can compare the effects of market volatilities on Putnam High and Ladenburg 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 High with a short position of Ladenburg Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam High and Ladenburg Growth.
Diversification Opportunities for Putnam High and Ladenburg Growth
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Putnam and Ladenburg is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Putnam High Income and Ladenburg Growth Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ladenburg Growth Income 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 Ladenburg Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ladenburg Growth Income has no effect on the direction of Putnam High i.e., Putnam High and Ladenburg Growth go up and down completely randomly.
Pair Corralation between Putnam High and Ladenburg Growth
Considering the 90-day investment horizon Putnam High is expected to generate 1.2 times less return on investment than Ladenburg Growth. But when comparing it to its historical volatility, Putnam High Income is 1.2 times less risky than Ladenburg Growth. It trades about 0.2 of its potential returns per unit of risk. Ladenburg Growth Income is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,520 in Ladenburg Growth Income on August 27, 2024 and sell it today you would earn a total of 36.00 from holding Ladenburg Growth Income or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam High Income vs. Ladenburg Growth Income
Performance |
| Timeline |
| Putnam High Income |
| Ladenburg Growth Income |
Putnam High and Ladenburg Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam High and Ladenburg Growth
The main advantage of trading using opposite Putnam High and Ladenburg Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam High position performs unexpectedly, Ladenburg 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 Ladenburg Growth will offset losses from the drop in Ladenburg Growth'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 |
| Ladenburg Growth vs. Ladenburg Growth | Ladenburg Growth vs. Ladenburg Growth | Ladenburg Growth vs. Ladenburg Growth | Ladenburg Growth vs. Ladenburg Income Fundclass |
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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