Correlation Between Putnam Global and Gmo Alternative
Can any of the company-specific risk be diversified away by investing in both Putnam Global and Gmo Alternative 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 Global and Gmo Alternative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Global Technology and Gmo Alternative Allocation, you can compare the effects of market volatilities on Putnam Global and Gmo Alternative 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 Global with a short position of Gmo Alternative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Global and Gmo Alternative.
Diversification Opportunities for Putnam Global and Gmo Alternative
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Putnam and Gmo is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Global Technology and Gmo Alternative Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Alternative Allo and Putnam Global 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 Global Technology are associated (or correlated) with Gmo Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Alternative Allo has no effect on the direction of Putnam Global i.e., Putnam Global and Gmo Alternative go up and down completely randomly.
Pair Corralation between Putnam Global and Gmo Alternative
Assuming the 90 days horizon Putnam Global Technology is expected to generate 3.63 times more return on investment than Gmo Alternative. However, Putnam Global is 3.63 times more volatile than Gmo Alternative Allocation. It trades about 0.01 of its potential returns per unit of risk. Gmo Alternative Allocation is currently generating about 0.03 per unit of risk. If you would invest 6,687 in Putnam Global Technology on December 11, 2024 and sell it today you would earn a total of 99.00 from holding Putnam Global Technology or generate 1.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Global Technology vs. Gmo Alternative Allocation
Performance |
| Timeline |
| Putnam Global Technology |
| Gmo Alternative Allo |
Putnam Global and Gmo Alternative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Global and Gmo Alternative
The main advantage of trading using opposite Putnam Global and Gmo Alternative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Global position performs unexpectedly, Gmo Alternative 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 Gmo Alternative will offset losses from the drop in Gmo Alternative's long position.| Putnam Global vs. Aqr Risk Parity | ||
| Putnam Global vs. Litman Gregory Masters | ||
| Putnam Global vs. Artisan High Income | ||
| Putnam Global vs. Ab High Income |
| Gmo Alternative vs. Transamerica Asset Allocation | ||
| Gmo Alternative vs. Balanced Allocation Fund | ||
| Gmo Alternative vs. T Rowe Price | ||
| Gmo Alternative vs. Calvert Moderate Allocation |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |