Correlation Between Putnam Multi and Putnam Global

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Putnam Multi and Putnam Global 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 Global 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 Global Income, you can compare the effects of market volatilities on Putnam Multi and Putnam Global 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 Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Multi and Putnam Global.

Diversification Opportunities for Putnam Multi and Putnam Global

-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 Multi Cap Growth and Putnam Global Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Global Income 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 Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Global Income has no effect on the direction of Putnam Multi i.e., Putnam Multi and Putnam Global go up and down completely randomly.

Pair Corralation between Putnam Multi and Putnam Global

Assuming the 90 days horizon Putnam Multi Cap Growth is expected to generate 3.72 times more return on investment than Putnam Global. However, Putnam Multi is 3.72 times more volatile than Putnam Global Income. It trades about 0.17 of its potential returns per unit of risk. Putnam Global Income is currently generating about 0.26 per unit of risk. If you would invest  11,770  in Putnam Multi Cap Growth on September 13, 2024 and sell it today you would earn a total of  256.00  from holding Putnam Multi Cap Growth or generate 2.18% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Putnam Multi Cap Growth  vs.  Putnam Global Income

 Performance 
       Timeline  
Putnam Multi Cap 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Putnam Multi Cap Growth are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Putnam Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Putnam Global Income 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Putnam Global Income has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Putnam Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Putnam Multi and Putnam Global Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Putnam Multi and Putnam Global

The main advantage of trading using opposite Putnam Multi and Putnam Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Multi position performs unexpectedly, Putnam Global 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 Global will offset losses from the drop in Putnam Global's long position.
The idea behind Putnam Multi Cap Growth and Putnam Global Income pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

Other Complementary Tools

Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments
Price Transformation
Use Price Transformation models to analyze the depth of different equity instruments across global markets