Correlation Between Putnam Convertible and Mfs Lifetime
Can any of the company-specific risk be diversified away by investing in both Putnam Convertible and Mfs Lifetime 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 Mfs Lifetime 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 Mfs Lifetime 2025, you can compare the effects of market volatilities on Putnam Convertible and Mfs Lifetime 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 Mfs Lifetime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Convertible and Mfs Lifetime.
Diversification Opportunities for Putnam Convertible and Mfs Lifetime
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Putnam and Mfs is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Convertible Incm Gwth and Mfs Lifetime 2025 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Lifetime 2025 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 Mfs Lifetime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Lifetime 2025 has no effect on the direction of Putnam Convertible i.e., Putnam Convertible and Mfs Lifetime go up and down completely randomly.
Pair Corralation between Putnam Convertible and Mfs Lifetime
Assuming the 90 days horizon Putnam Convertible Incm Gwth is expected to generate 1.52 times more return on investment than Mfs Lifetime. However, Putnam Convertible is 1.52 times more volatile than Mfs Lifetime 2025. It trades about 0.09 of its potential returns per unit of risk. Mfs Lifetime 2025 is currently generating about 0.09 per unit of risk. If you would invest 2,080 in Putnam Convertible Incm Gwth on August 30, 2024 and sell it today you would earn a total of 537.00 from holding Putnam Convertible Incm Gwth or generate 25.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Convertible Incm Gwth vs. Mfs Lifetime 2025
Performance |
| Timeline |
| Putnam Convertible Incm |
| Mfs Lifetime 2025 |
Putnam Convertible and Mfs Lifetime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Convertible and Mfs Lifetime
The main advantage of trading using opposite Putnam Convertible and Mfs Lifetime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Convertible position performs unexpectedly, Mfs Lifetime 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 Mfs Lifetime will offset losses from the drop in Mfs Lifetime's long position.| Putnam Convertible vs. T Rowe Price | Putnam Convertible vs. Ppm High Yield | Putnam Convertible vs. Metropolitan West High | Putnam Convertible vs. California High Yield Municipal |
| Mfs Lifetime vs. Fidelity Sai Convertible | Mfs Lifetime vs. Putnam Convertible Incm Gwth | Mfs Lifetime vs. Advent Claymore Convertible | Mfs Lifetime vs. Absolute Convertible Arbitrage |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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