Correlation Between Putnam Money and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Putnam Money and Baillie Gifford 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 Money and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Money Market and Baillie Gifford Global, you can compare the effects of market volatilities on Putnam Money and Baillie Gifford 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 Money with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Money and Baillie Gifford.
Diversification Opportunities for Putnam Money and Baillie Gifford
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Putnam and Baillie is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Money Market and Baillie Gifford Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Global and Putnam Money 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 Money Market are associated (or correlated) with Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford Global has no effect on the direction of Putnam Money i.e., Putnam Money and Baillie Gifford go up and down completely randomly.
Pair Corralation between Putnam Money and Baillie Gifford
Assuming the 90 days horizon Putnam Money is expected to generate 2.16 times less return on investment than Baillie Gifford. But when comparing it to its historical volatility, Putnam Money Market is 1.59 times less risky than Baillie Gifford. It trades about 0.03 of its potential returns per unit of risk. Baillie Gifford Global is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,552 in Baillie Gifford Global on November 2, 2024 and sell it today you would earn a total of 297.00 from holding Baillie Gifford Global or generate 19.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Putnam Money Market vs. Baillie Gifford Global
Performance |
| Timeline |
| Putnam Money Market |
| Baillie Gifford Global |
Putnam Money and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Money and Baillie Gifford
The main advantage of trading using opposite Putnam Money and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Money position performs unexpectedly, Baillie Gifford 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 Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.| Putnam Money vs. Lord Abbett Diversified | Putnam Money vs. Fulcrum Diversified Absolute | Putnam Money vs. Blackrock Conservative Prprdptfinstttnl | Putnam Money vs. Mainstay Conservative Allocation |
| Baillie Gifford vs. Gugg Actv Invmt | Baillie Gifford vs. Us High Relative | Baillie Gifford vs. Siit High Yield | Baillie Gifford vs. Transamerica 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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