Correlation Between Putnam Growth and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Putnam Growth and Eaton Vance 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 Eaton Vance 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 Eaton Vance Tax Managed, you can compare the effects of market volatilities on Putnam Growth and Eaton Vance 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 Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Growth and Eaton Vance.
Diversification Opportunities for Putnam Growth and Eaton Vance
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Putnam and Eaton is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Growth Opportunities and Eaton Vance Tax Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Tax 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 Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Tax has no effect on the direction of Putnam Growth i.e., Putnam Growth and Eaton Vance go up and down completely randomly.
Pair Corralation between Putnam Growth and Eaton Vance
Assuming the 90 days horizon Putnam Growth Opportunities is expected to generate 1.37 times more return on investment than Eaton Vance. However, Putnam Growth is 1.37 times more volatile than Eaton Vance Tax Managed. It trades about -0.02 of its potential returns per unit of risk. Eaton Vance Tax Managed is currently generating about -0.17 per unit of risk. If you would invest 7,099 in Putnam Growth Opportunities on November 27, 2024 and sell it today you would lose (172.00) from holding Putnam Growth Opportunities or give up 2.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Growth Opportunities vs. Eaton Vance Tax Managed
Performance |
| Timeline |
| Putnam Growth Opport |
| Eaton Vance Tax |
Putnam Growth and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Growth and Eaton Vance
The main advantage of trading using opposite Putnam Growth and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Growth position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Putnam Growth vs. Putnam Equity Income | Putnam Growth vs. Putnam Multi Cap Growth | Putnam Growth vs. Putnam Global Health | Putnam Growth vs. Putnam International Equity |
| Eaton Vance vs. Pioneer High Income | Eaton Vance vs. Ab High Income | Eaton Vance vs. Intal High Relative | Eaton Vance vs. Goldman Sachs High |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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