Correlation Between Putnam Focused and Putnam International
Can any of the company-specific risk be diversified away by investing in both Putnam Focused and Putnam International 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 Focused and Putnam International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Focused Equity and Putnam International Capital, you can compare the effects of market volatilities on Putnam Focused and Putnam International 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 Focused with a short position of Putnam International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Focused and Putnam International.
Diversification Opportunities for Putnam Focused and Putnam International
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Putnam and Putnam is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Focused Equity and Putnam International Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam International and Putnam Focused 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 Focused Equity are associated (or correlated) with Putnam International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam International has no effect on the direction of Putnam Focused i.e., Putnam Focused and Putnam International go up and down completely randomly.
Pair Corralation between Putnam Focused and Putnam International
Assuming the 90 days horizon Putnam Focused Equity is expected to generate 0.97 times more return on investment than Putnam International. However, Putnam Focused Equity is 1.03 times less risky than Putnam International. It trades about 0.13 of its potential returns per unit of risk. Putnam International Capital is currently generating about 0.04 per unit of risk. If you would invest 2,735 in Putnam Focused Equity on September 2, 2024 and sell it today you would earn a total of 1,226 from holding Putnam Focused Equity or generate 44.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Focused Equity vs. Putnam International Capital
Performance |
| Timeline |
| Putnam Focused Equity |
| Putnam International |
Putnam Focused and Putnam International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Focused and Putnam International
The main advantage of trading using opposite Putnam Focused and Putnam International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Focused position performs unexpectedly, Putnam International 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 International will offset losses from the drop in Putnam International's long position.| Putnam Focused vs. Putnam Equity Income | Putnam Focused vs. Putnam Tax Exempt | Putnam Focused vs. Putnam Floating Rate | Putnam Focused vs. Putnam High Yield |
| Putnam International vs. Us Strategic Equity | Putnam International vs. Us Vector Equity | Putnam International vs. Ms Global Fixed | Putnam International vs. Icon Equity Income |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |