Correlation Between Putnam High and Tekla World
Can any of the company-specific risk be diversified away by investing in both Putnam High and Tekla World 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 Tekla World 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 Tekla World Healthcare, you can compare the effects of market volatilities on Putnam High and Tekla World 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 Tekla World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam High and Tekla World.
Diversification Opportunities for Putnam High and Tekla World
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Putnam and Tekla is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Putnam High Income and Tekla World Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tekla World Healthcare 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 Tekla World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tekla World Healthcare has no effect on the direction of Putnam High i.e., Putnam High and Tekla World go up and down completely randomly.
Pair Corralation between Putnam High and Tekla World
Considering the 90-day investment horizon Putnam High Income is expected to generate 0.93 times more return on investment than Tekla World. However, Putnam High Income is 1.08 times less risky than Tekla World. It trades about 0.09 of its potential returns per unit of risk. Tekla World Healthcare is currently generating about 0.04 per unit of risk. If you would invest 556.00 in Putnam High Income on November 9, 2024 and sell it today you would earn a total of 113.00 from holding Putnam High Income or generate 20.32% 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. Tekla World Healthcare
Performance |
| Timeline |
| Putnam High Income |
| Tekla World Healthcare |
Putnam High and Tekla World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam High and Tekla World
The main advantage of trading using opposite Putnam High and Tekla World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam High position performs unexpectedly, Tekla World 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 Tekla World will offset losses from the drop in Tekla World'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 |
| Tekla World vs. Tekla Healthcare Investors | Tekla World vs. Tekla Life Sciences | Tekla World vs. Flaherty and Crumrine | Tekla World vs. Cohen And Steers |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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