Correlation Between Putnam Global and Wt Mutual
Can any of the company-specific risk be diversified away by investing in both Putnam Global and Wt Mutual 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 Wt Mutual 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 Wt Mutual Fund, you can compare the effects of market volatilities on Putnam Global and Wt Mutual 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 Wt Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Global and Wt Mutual.
Diversification Opportunities for Putnam Global and Wt Mutual
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Putnam and WGSXX is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Global Income and Wt Mutual Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wt Mutual Fund 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 Wt Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wt Mutual Fund has no effect on the direction of Putnam Global i.e., Putnam Global and Wt Mutual go up and down completely randomly.
Pair Corralation between Putnam Global and Wt Mutual
Assuming the 90 days horizon Putnam Global Income is expected to generate 2.31 times more return on investment than Wt Mutual. However, Putnam Global is 2.31 times more volatile than Wt Mutual Fund. It trades about 0.08 of its potential returns per unit of risk. Wt Mutual Fund is currently generating about 0.14 per unit of risk. If you would invest 937.00 in Putnam Global Income on September 12, 2024 and sell it today you would earn a total of 79.00 from holding Putnam Global Income or generate 8.43% 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. Wt Mutual Fund
Performance |
| Timeline |
| Putnam Global Income |
| Wt Mutual Fund |
Putnam Global and Wt Mutual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Global and Wt Mutual
The main advantage of trading using opposite Putnam Global and Wt Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Global position performs unexpectedly, Wt Mutual 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 Wt Mutual will offset losses from the drop in Wt Mutual's long position.| Putnam Global vs. Elfun Government Money | Putnam Global vs. Edward Jones Money | Putnam Global vs. Ubs Money Series | Putnam Global vs. The Gabelli Money |
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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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