Correlation Between Putnam Convertible and The Hartford
Can any of the company-specific risk be diversified away by investing in both Putnam Convertible and The Hartford 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 Convertible and The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Convertible Incm Gwth and The Hartford Growth, you can compare the effects of market volatilities on Putnam Convertible and The Hartford 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 Convertible with a short position of The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Convertible and The Hartford.
Diversification Opportunities for Putnam Convertible and The Hartford
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Putnam and The is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Convertible Incm Gwth and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth and Putnam Convertible 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 Convertible Incm Gwth are associated (or correlated) with The Hartford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Growth has no effect on the direction of Putnam Convertible i.e., Putnam Convertible and The Hartford go up and down completely randomly.
Pair Corralation between Putnam Convertible and The Hartford
Assuming the 90 days horizon Putnam Convertible is expected to generate 2.43 times less return on investment than The Hartford. But when comparing it to its historical volatility, Putnam Convertible Incm Gwth is 2.28 times less risky than The Hartford. It trades about 0.1 of its potential returns per unit of risk. The Hartford Growth is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4,736 in The Hartford Growth on September 2, 2024 and sell it today you would earn a total of 2,727 from holding The Hartford Growth or generate 57.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Convertible Incm Gwth vs. The Hartford Growth
Performance |
| Timeline |
| Putnam Convertible Incm |
| Hartford Growth |
Putnam Convertible and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Convertible and The Hartford
The main advantage of trading using opposite Putnam Convertible and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Convertible position performs unexpectedly, The Hartford 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 The Hartford will offset losses from the drop in The Hartford's long position.| Putnam Convertible vs. Qs Small Capitalization | Putnam Convertible vs. Baird Smallmid Cap | Putnam Convertible vs. Ab Small Cap | Putnam Convertible vs. T Rowe Price |
| The Hartford vs. The Hartford Dividend | The Hartford vs. The Hartford Capital | The Hartford vs. The Hartford Equity | The Hartford vs. The Hartford Midcap |
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 Stocks Directory module to find actively traded stocks across global markets.
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