Correlation Between Deutsche Multi and Putnman Retirement
Can any of the company-specific risk be diversified away by investing in both Deutsche Multi and Putnman Retirement 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 Deutsche Multi and Putnman Retirement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Multi Asset Moderate and Putnman Retirement Ready, you can compare the effects of market volatilities on Deutsche Multi and Putnman Retirement 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 Deutsche Multi with a short position of Putnman Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Multi and Putnman Retirement.
Diversification Opportunities for Deutsche Multi and Putnman Retirement
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Deutsche and Putnman is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Multi Asset Moderate and Putnman Retirement Ready in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnman Retirement Ready and Deutsche 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 Deutsche Multi Asset Moderate are associated (or correlated) with Putnman Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnman Retirement Ready has no effect on the direction of Deutsche Multi i.e., Deutsche Multi and Putnman Retirement go up and down completely randomly.
Pair Corralation between Deutsche Multi and Putnman Retirement
Assuming the 90 days horizon Deutsche Multi is expected to generate 1.63 times less return on investment than Putnman Retirement. In addition to that, Deutsche Multi is 1.08 times more volatile than Putnman Retirement Ready. It trades about 0.13 of its total potential returns per unit of risk. Putnman Retirement Ready is currently generating about 0.23 per unit of volatility. If you would invest 2,592 in Putnman Retirement Ready on September 13, 2024 and sell it today you would earn a total of 40.00 from holding Putnman Retirement Ready or generate 1.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Deutsche Multi Asset Moderate vs. Putnman Retirement Ready
Performance |
| Timeline |
| Deutsche Multi Asset |
| Putnman Retirement Ready |
Deutsche Multi and Putnman Retirement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Multi and Putnman Retirement
The main advantage of trading using opposite Deutsche Multi and Putnman Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Multi position performs unexpectedly, Putnman Retirement 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 Putnman Retirement will offset losses from the drop in Putnman Retirement's long position.| Deutsche Multi vs. Df Dent Small | Deutsche Multi vs. Kinetics Small Cap | Deutsche Multi vs. Franklin Small Cap | Deutsche Multi vs. Pace Smallmedium Value |
| Putnman Retirement vs. Aig Government Money | Putnman Retirement vs. Dunham Porategovernment Bond | Putnman Retirement vs. Inverse Government Long | Putnman Retirement vs. Elfun Government Money |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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