Correlation Between Putnam Convertible and Allianzgi Convertible
Can any of the company-specific risk be diversified away by investing in both Putnam Convertible and Allianzgi Convertible 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 Convertible and Allianzgi Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Convertible Securities and Allianzgi Convertible Income, you can compare the effects of market volatilities on Putnam Convertible and Allianzgi Convertible 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 Convertible with a short position of Allianzgi Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Convertible and Allianzgi Convertible.
Diversification Opportunities for Putnam Convertible and Allianzgi Convertible
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Putnam and Allianzgi is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Convertible Securities and Allianzgi Convertible Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Convertible and Putnam Convertible 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 Convertible Securities are associated (or correlated) with Allianzgi Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Convertible has no effect on the direction of Putnam Convertible i.e., Putnam Convertible and Allianzgi Convertible go up and down completely randomly.
Pair Corralation between Putnam Convertible and Allianzgi Convertible
Assuming the 90 days horizon Putnam Convertible Securities is expected to generate 0.76 times more return on investment than Allianzgi Convertible. However, Putnam Convertible Securities is 1.32 times less risky than Allianzgi Convertible. It trades about 0.25 of its potential returns per unit of risk. Allianzgi Convertible Income is currently generating about 0.18 per unit of risk. If you would invest 2,572 in Putnam Convertible Securities on November 3, 2024 and sell it today you would earn a total of 85.00 from holding Putnam Convertible Securities or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Convertible Securities vs. Allianzgi Convertible Income
Performance |
| Timeline |
| Putnam Convertible |
| Allianzgi Convertible |
Putnam Convertible and Allianzgi Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Convertible and Allianzgi Convertible
The main advantage of trading using opposite Putnam Convertible and Allianzgi Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Convertible position performs unexpectedly, Allianzgi Convertible 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 Allianzgi Convertible will offset losses from the drop in Allianzgi Convertible's long position.| Putnam Convertible vs. Salient Mlp Energy | Putnam Convertible vs. Short Oil Gas | Putnam Convertible vs. Thrivent Natural Resources | Putnam Convertible vs. Clearbridge Energy Mlp |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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