Correlation Between Putnam Short and Pioneer Multi-asset
Can any of the company-specific risk be diversified away by investing in both Putnam Short and Pioneer Multi-asset 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 Pioneer Multi-asset 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 Pioneer Multi Asset Ultrashort, you can compare the effects of market volatilities on Putnam Short and Pioneer Multi-asset 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 Pioneer Multi-asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Short and Pioneer Multi-asset.
Diversification Opportunities for Putnam Short and Pioneer Multi-asset
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Putnam and Pioneer is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Short Duration and Pioneer Multi Asset Ultrashort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Multi Asset 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 Pioneer Multi-asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Multi Asset has no effect on the direction of Putnam Short i.e., Putnam Short and Pioneer Multi-asset go up and down completely randomly.
Pair Corralation between Putnam Short and Pioneer Multi-asset
Assuming the 90 days horizon Putnam Short is expected to generate 1.3 times less return on investment than Pioneer Multi-asset. But when comparing it to its historical volatility, Putnam Short Duration is 1.21 times less risky than Pioneer Multi-asset. It trades about 0.2 of its potential returns per unit of risk. Pioneer Multi Asset Ultrashort is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 861.00 in Pioneer Multi Asset Ultrashort on August 27, 2024 and sell it today you would earn a total of 107.00 from holding Pioneer Multi Asset Ultrashort or generate 12.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Short Duration vs. Pioneer Multi Asset Ultrashort
Performance |
| Timeline |
| Putnam Short Duration |
| Pioneer Multi Asset |
Putnam Short and Pioneer Multi-asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Short and Pioneer Multi-asset
The main advantage of trading using opposite Putnam Short and Pioneer Multi-asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Short position performs unexpectedly, Pioneer Multi-asset 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 Pioneer Multi-asset will offset losses from the drop in Pioneer Multi-asset's long position.| Putnam Short vs. Putnam Equity Income | Putnam Short vs. Putnam Tax Exempt | Putnam Short vs. Putnam Floating Rate | Putnam Short vs. Putnam High Yield |
| Pioneer Multi-asset vs. Pioneer Fundamental Growth | Pioneer Multi-asset vs. Pioneer Global Equity | Pioneer Multi-asset vs. Pioneer Solutions Balanced | Pioneer Multi-asset vs. Pioneer Core Equity |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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