Correlation Between Putnam U and Putnam Research
Can any of the company-specific risk be diversified away by investing in both Putnam U and Putnam Research 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 U and Putnam Research into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam U S and Putnam Research Fund, you can compare the effects of market volatilities on Putnam U and Putnam Research 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 U with a short position of Putnam Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam U and Putnam Research.
Diversification Opportunities for Putnam U and Putnam Research
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PUTNAM and Putnam is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Putnam U S and Putnam Research Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Research and Putnam U 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 U S are associated (or correlated) with Putnam Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Research has no effect on the direction of Putnam U i.e., Putnam U and Putnam Research go up and down completely randomly.
Pair Corralation between Putnam U and Putnam Research
Assuming the 90 days horizon Putnam U is expected to generate 3.83 times less return on investment than Putnam Research. But when comparing it to its historical volatility, Putnam U S is 2.05 times less risky than Putnam Research. It trades about 0.11 of its potential returns per unit of risk. Putnam Research Fund is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 5,612 in Putnam Research Fund on August 31, 2024 and sell it today you would earn a total of 211.00 from holding Putnam Research Fund or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam U S vs. Putnam Research Fund
Performance |
| Timeline |
| Putnam U S |
| Putnam Research |
Putnam U and Putnam Research Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam U and Putnam Research
The main advantage of trading using opposite Putnam U and Putnam Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam U position performs unexpectedly, Putnam Research 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 Research will offset losses from the drop in Putnam Research's long position.| Putnam U vs. Small Midcap Dividend Income | Putnam U vs. Chartwell Small Cap | Putnam U vs. Victory Rs Small | Putnam U vs. Tax Managed Mid Small |
| Putnam Research vs. Aquagold International | Putnam Research vs. Morningstar Unconstrained Allocation | Putnam Research vs. Thrivent High Yield | Putnam Research vs. Via Renewables |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| 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 | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |