Correlation Between Putnam Global and Putnam Growth
Can any of the company-specific risk be diversified away by investing in both Putnam Global 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 Global 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 Global Income and Putnam Growth Opportunities, you can compare the effects of market volatilities on Putnam Global 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 Global with a short position of Putnam Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Global and Putnam Growth.
Diversification Opportunities for Putnam Global and Putnam Growth
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Putnam and Putnam is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Global Income 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 Global 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 Global Income 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 Global i.e., Putnam Global and Putnam Growth go up and down completely randomly.
Pair Corralation between Putnam Global and Putnam Growth
Assuming the 90 days horizon Putnam Global is expected to generate 6.55 times less return on investment than Putnam Growth. But when comparing it to its historical volatility, Putnam Global Income is 3.61 times less risky than Putnam Growth. It trades about 0.06 of its potential returns per unit of risk. Putnam Growth Opportunities is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4,101 in Putnam Growth Opportunities on August 25, 2024 and sell it today you would earn a total of 1,357 from holding Putnam Growth Opportunities or generate 33.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Global Income vs. Putnam Growth Opportunities
Performance |
| Timeline |
| Putnam Global Income |
| Putnam Growth Opport |
Putnam Global and Putnam Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Global and Putnam Growth
The main advantage of trading using opposite Putnam Global and Putnam Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Global 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 Global vs. Putnam Equity Income | Putnam Global vs. Putnam Tax Exempt | Putnam Global vs. Putnam Floating Rate | Putnam Global vs. Putnam High Yield |
| Putnam Growth vs. George Putnam Fund | Putnam Growth vs. Putnam Dynamic Asset | Putnam Growth vs. Aquagold International | Putnam Growth vs. Morningstar Unconstrained Allocation |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |