Correlation Between Putnam Equity and Fisher Small
Can any of the company-specific risk be diversified away by investing in both Putnam Equity and Fisher Small 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 Equity and Fisher Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Equity Income and Fisher Small Cap, you can compare the effects of market volatilities on Putnam Equity and Fisher Small 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 Equity with a short position of Fisher Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Equity and Fisher Small.
Diversification Opportunities for Putnam Equity and Fisher Small
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Putnam and Fisher is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Equity Income and Fisher Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fisher Small Cap and Putnam Equity 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 Equity Income are associated (or correlated) with Fisher Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fisher Small Cap has no effect on the direction of Putnam Equity i.e., Putnam Equity and Fisher Small go up and down completely randomly.
Pair Corralation between Putnam Equity and Fisher Small
Assuming the 90 days horizon Putnam Equity Income is expected to generate 0.57 times more return on investment than Fisher Small. However, Putnam Equity Income is 1.76 times less risky than Fisher Small. It trades about 0.07 of its potential returns per unit of risk. Fisher Small Cap is currently generating about 0.03 per unit of risk. If you would invest 2,812 in Putnam Equity Income on November 27, 2024 and sell it today you would earn a total of 766.00 from holding Putnam Equity Income or generate 27.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Equity Income vs. Fisher Small Cap
Performance |
| Timeline |
| Putnam Equity Income |
| Fisher Small Cap |
Putnam Equity and Fisher Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Equity and Fisher Small
The main advantage of trading using opposite Putnam Equity and Fisher Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Equity position performs unexpectedly, Fisher Small 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 Fisher Small will offset losses from the drop in Fisher Small's long position.| Putnam Equity vs. Putnam Growth Opportunities | Putnam Equity vs. Putnam International Equity | Putnam Equity vs. George Putnam Fund | Putnam Equity vs. Putnam Multi Cap Growth |
| Fisher Small vs. Lord Abbett Diversified | Fisher Small vs. Blackrock Conservative Prprdptfinstttnl | Fisher Small vs. Stone Ridge Diversified | Fisher Small vs. Manning Napier Diversified |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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