Correlation Between Putnam Global and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Putnam Global and Goldman Sachs 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 Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Global Financials and Goldman Sachs Mlp, you can compare the effects of market volatilities on Putnam Global and Goldman Sachs 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 Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Global and Goldman Sachs.
Diversification Opportunities for Putnam Global and Goldman Sachs
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Putnam and Goldman is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Global Financials and Goldman Sachs Mlp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Mlp 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 Financials are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Mlp has no effect on the direction of Putnam Global i.e., Putnam Global and Goldman Sachs go up and down completely randomly.
Pair Corralation between Putnam Global and Goldman Sachs
Assuming the 90 days horizon Putnam Global is expected to generate 1.72 times less return on investment than Goldman Sachs. But when comparing it to its historical volatility, Putnam Global Financials is 2.09 times less risky than Goldman Sachs. It trades about 0.08 of its potential returns per unit of risk. Goldman Sachs Mlp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,031 in Goldman Sachs Mlp on November 1, 2024 and sell it today you would earn a total of 393.00 from holding Goldman Sachs Mlp or generate 38.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 41.99% |
| Values | Daily Returns |
Putnam Global Financials vs. Goldman Sachs Mlp
Performance |
| Timeline |
| Putnam Global Financials |
| Goldman Sachs Mlp |
Putnam Global and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Global and Goldman Sachs
The main advantage of trading using opposite Putnam Global and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Global position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| Putnam Global vs. Goldman Sachs Mlp | Putnam Global vs. Energy Services Fund | Putnam Global vs. Alpsalerian Energy Infrastructure | Putnam Global vs. Hennessy Bp Energy |
| Goldman Sachs vs. Ab Bond Inflation | Goldman Sachs vs. Ambrus Core Bond | Goldman Sachs vs. Barings High Yield | Goldman Sachs vs. Rbc Ultra Short Fixed |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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