Correlation Between Putnam Multi and Putnam Convertible
Can any of the company-specific risk be diversified away by investing in both Putnam Multi and Putnam Convertible 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 Multi and Putnam Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Multi Cap Growth and Putnam Vertible Securities, you can compare the effects of market volatilities on Putnam Multi and Putnam Convertible 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 Multi with a short position of Putnam Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Multi and Putnam Convertible.
Diversification Opportunities for Putnam Multi and Putnam Convertible
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Putnam and Putnam is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Multi Cap Growth and Putnam Vertible Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Vertible Secu and Putnam Multi 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 Multi Cap Growth are associated (or correlated) with Putnam Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Vertible Secu has no effect on the direction of Putnam Multi i.e., Putnam Multi and Putnam Convertible go up and down completely randomly.
Pair Corralation between Putnam Multi and Putnam Convertible
Assuming the 90 days horizon Putnam Multi Cap Growth is expected to generate 1.55 times more return on investment than Putnam Convertible. However, Putnam Multi is 1.55 times more volatile than Putnam Vertible Securities. It trades about 0.11 of its potential returns per unit of risk. Putnam Vertible Securities is currently generating about 0.11 per unit of risk. If you would invest 9,348 in Putnam Multi Cap Growth on September 3, 2024 and sell it today you would earn a total of 3,715 from holding Putnam Multi Cap Growth or generate 39.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Multi Cap Growth vs. Putnam Vertible Securities
Performance |
| Timeline |
| Putnam Multi Cap |
| Putnam Vertible Secu |
Putnam Multi and Putnam Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Multi and Putnam Convertible
The main advantage of trading using opposite Putnam Multi and Putnam Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Multi position performs unexpectedly, Putnam Convertible 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 Convertible will offset losses from the drop in Putnam Convertible's long position.| Putnam Multi vs. Touchstone Premium Yield | Putnam Multi vs. T Rowe Price | Putnam Multi vs. Multisector Bond Sma | Putnam Multi vs. Bbh Intermediate Municipal |
| Putnam Convertible vs. Putnam Multi Cap Growth | Putnam Convertible vs. Putnam Multi Cap Growth | Putnam Convertible vs. Putnam Sustainable Future | Putnam Convertible vs. Putnam 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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