Correlation Between Putnam Growth and Arrow Managed
Can any of the company-specific risk be diversified away by investing in both Putnam Growth and Arrow Managed 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 Growth and Arrow Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Growth Opportunities and Arrow Managed Futures, you can compare the effects of market volatilities on Putnam Growth and Arrow Managed 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 Growth with a short position of Arrow Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Growth and Arrow Managed.
Diversification Opportunities for Putnam Growth and Arrow Managed
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Putnam and Arrow is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Growth Opportunities and Arrow Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Managed Futures and Putnam Growth 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 Growth Opportunities are associated (or correlated) with Arrow Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Managed Futures has no effect on the direction of Putnam Growth i.e., Putnam Growth and Arrow Managed go up and down completely randomly.
Pair Corralation between Putnam Growth and Arrow Managed
Assuming the 90 days horizon Putnam Growth Opportunities is expected to generate 1.16 times more return on investment than Arrow Managed. However, Putnam Growth is 1.16 times more volatile than Arrow Managed Futures. It trades about 0.05 of its potential returns per unit of risk. Arrow Managed Futures is currently generating about -0.02 per unit of risk. If you would invest 6,575 in Putnam Growth Opportunities on October 9, 2024 and sell it today you would earn a total of 67.00 from holding Putnam Growth Opportunities or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Growth Opportunities vs. Arrow Managed Futures
Performance |
| Timeline |
| Putnam Growth Opport |
| Arrow Managed Futures |
Putnam Growth and Arrow Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Growth and Arrow Managed
The main advantage of trading using opposite Putnam Growth and Arrow Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Growth position performs unexpectedly, Arrow Managed 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 Arrow Managed will offset losses from the drop in Arrow Managed's long position.| Putnam Growth vs. Icon Information Technology | Putnam Growth vs. Pgim Jennison Technology | Putnam Growth vs. Specialized Technology Fund | Putnam Growth vs. Allianzgi Technology Fund |
| Arrow Managed vs. Federated Global Allocation | Arrow Managed vs. L Abbett Fundamental | Arrow Managed vs. Predex Funds | Arrow Managed vs. Versatile Bond Portfolio |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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