Correlation Between Putnam Short and Gamco Global
Can any of the company-specific risk be diversified away by investing in both Putnam Short and Gamco 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 Short and Gamco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Short Duration and Gamco Global Telecommunications, you can compare the effects of market volatilities on Putnam Short and Gamco 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 Short with a short position of Gamco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Short and Gamco Global.
Diversification Opportunities for Putnam Short and Gamco Global
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Putnam and Gamco is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Short Duration and Gamco Global Telecommunication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamco Global Telecom and Putnam Short 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 Short Duration are associated (or correlated) with Gamco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamco Global Telecom has no effect on the direction of Putnam Short i.e., Putnam Short and Gamco Global go up and down completely randomly.
Pair Corralation between Putnam Short and Gamco Global
Assuming the 90 days horizon Putnam Short Duration is expected to generate 0.14 times more return on investment than Gamco Global. However, Putnam Short Duration is 6.99 times less risky than Gamco Global. It trades about 0.14 of its potential returns per unit of risk. Gamco Global Telecommunications is currently generating about -0.02 per unit of risk. If you would invest 1,008 in Putnam Short Duration on August 28, 2024 and sell it today you would earn a total of 5.00 from holding Putnam Short Duration or generate 0.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Short Duration vs. Gamco Global Telecommunication
Performance |
| Timeline |
| Putnam Short Duration |
| Gamco Global Telecom |
Putnam Short and Gamco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Short and Gamco Global
The main advantage of trading using opposite Putnam Short and Gamco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Short position performs unexpectedly, Gamco 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 Gamco Global will offset losses from the drop in Gamco Global's long position.| Putnam Short vs. Alliancebernstein National Municipal | Putnam Short vs. Bbh Intermediate Municipal | Putnam Short vs. Gamco Global Telecommunications | Putnam Short vs. Oklahoma Municipal Fund |
| Gamco Global vs. Red Oak Technology | Gamco Global vs. Allianzgi Technology Fund | Gamco Global vs. Icon Information Technology | Gamco Global vs. Janus Global Technology |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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