Correlation Between Putnam Short and Putnam Ultra
Can any of the company-specific risk be diversified away by investing in both Putnam Short and Putnam Ultra 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 Putnam Ultra 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 Putnam Ultra Short, you can compare the effects of market volatilities on Putnam Short and Putnam Ultra 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 Putnam Ultra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Short and Putnam Ultra.
Diversification Opportunities for Putnam Short and Putnam Ultra
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Putnam and Putnam is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Short Duration and Putnam Ultra Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Ultra Short 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 Putnam Ultra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Ultra Short has no effect on the direction of Putnam Short i.e., Putnam Short and Putnam Ultra go up and down completely randomly.
Pair Corralation between Putnam Short and Putnam Ultra
Assuming the 90 days horizon Putnam Short Duration is expected to generate 1.01 times more return on investment than Putnam Ultra. However, Putnam Short is 1.01 times more volatile than Putnam Ultra Short. It trades about 0.21 of its potential returns per unit of risk. Putnam Ultra Short is currently generating about 0.2 per unit of risk. If you would invest 911.00 in Putnam Short Duration on November 4, 2024 and sell it today you would earn a total of 102.00 from holding Putnam Short Duration or generate 11.2% 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. Putnam Ultra Short
Performance |
| Timeline |
| Putnam Short Duration |
| Putnam Ultra Short |
Putnam Short and Putnam Ultra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Short and Putnam Ultra
The main advantage of trading using opposite Putnam Short and Putnam Ultra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Short position performs unexpectedly, Putnam Ultra 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 Putnam Ultra will offset losses from the drop in Putnam Ultra's long position.| Putnam Short vs. Prudential Financial Services | Putnam Short vs. Davis Financial Fund | Putnam Short vs. Edward Jones Money | Putnam Short vs. Chestnut Street Exchange |
| Putnam Ultra vs. Putnam Multi Cap Growth | Putnam Ultra vs. Putnam Multi Cap Growth | Putnam Ultra vs. Putnam Sustainable Future | Putnam Ultra vs. Putnam Equity Income |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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