Correlation Between Putnam Global and Putnam Short
Can any of the company-specific risk be diversified away by investing in both Putnam Global and Putnam Short 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 Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Global Health and Putnam Short Duration, you can compare the effects of market volatilities on Putnam Global and Putnam Short 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 Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Global and Putnam Short.
Diversification Opportunities for Putnam Global and Putnam Short
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Putnam and Putnam is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Global Health and Putnam Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Short Duration 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 Health are associated (or correlated) with Putnam Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Short Duration has no effect on the direction of Putnam Global i.e., Putnam Global and Putnam Short go up and down completely randomly.
Pair Corralation between Putnam Global and Putnam Short
Assuming the 90 days horizon Putnam Global Health is expected to under-perform the Putnam Short. In addition to that, Putnam Global is 8.17 times more volatile than Putnam Short Duration. It trades about -0.27 of its total potential returns per unit of risk. Putnam Short Duration is currently generating about 0.15 per unit of volatility. If you would invest 1,010 in Putnam Short Duration on August 28, 2024 and sell it today you would earn a total of 3.00 from holding Putnam Short Duration or generate 0.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Global Health vs. Putnam Short Duration
Performance |
| Timeline |
| Putnam Global Health |
| Putnam Short Duration |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Putnam Global and Putnam Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Global and Putnam Short
The main advantage of trading using opposite Putnam Global and Putnam Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Global position performs unexpectedly, Putnam Short 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 Short will offset losses from the drop in Putnam Short's long position.| Putnam Global vs. T Rowe Price | Putnam Global vs. Eip Growth And | Putnam Global vs. Tfa Alphagen Growth | Putnam Global vs. Praxis Growth Index |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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