Correlation Between Putnam Tax and Putnam Growth
Can any of the company-specific risk be diversified away by investing in both Putnam Tax and Putnam 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 Tax and Putnam Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Tax Exempt and Putnam Growth Opportunities, you can compare the effects of market volatilities on Putnam Tax and Putnam 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 Tax with a short position of Putnam Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Tax and Putnam Growth.
Diversification Opportunities for Putnam Tax and Putnam Growth
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Putnam and Putnam is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Tax Exempt and Putnam Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Growth Opport and Putnam Tax 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 Tax Exempt are associated (or correlated) with Putnam Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Growth Opport has no effect on the direction of Putnam Tax i.e., Putnam Tax and Putnam Growth go up and down completely randomly.
Pair Corralation between Putnam Tax and Putnam Growth
If you would invest 786.00 in Putnam Tax Exempt on September 13, 2024 and sell it today you would earn a total of 10.00 from holding Putnam Tax Exempt or generate 1.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Tax Exempt vs. Putnam Growth Opportunities
Performance |
| Timeline |
| Putnam Tax Exempt |
| Putnam Growth Opport |
Putnam Tax and Putnam Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Tax and Putnam Growth
The main advantage of trading using opposite Putnam Tax and Putnam Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Tax position performs unexpectedly, Putnam 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 Putnam Growth will offset losses from the drop in Putnam Growth's long position.| Putnam Tax vs. Putnam Equity Income | Putnam Tax vs. Putnam Floating Rate | Putnam Tax vs. Putnam High Yield | Putnam Tax vs. Putnam Floating Rate |
| Putnam Growth vs. Putnam Equity Income | Putnam Growth vs. Putnam Tax Exempt | Putnam Growth vs. Putnam Floating Rate | Putnam Growth vs. Putnam High Yield |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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