Correlation Between Putnam Massachusetts and Putnam Ohio
Can any of the company-specific risk be diversified away by investing in both Putnam Massachusetts and Putnam Ohio 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 Massachusetts and Putnam Ohio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Massachusetts Tax and Putnam Ohio Tax, you can compare the effects of market volatilities on Putnam Massachusetts and Putnam Ohio 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 Massachusetts with a short position of Putnam Ohio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Massachusetts and Putnam Ohio.
Diversification Opportunities for Putnam Massachusetts and Putnam Ohio
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 Massachusetts Tax and Putnam Ohio Tax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Ohio Tax and Putnam Massachusetts 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 Massachusetts Tax are associated (or correlated) with Putnam Ohio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Ohio Tax has no effect on the direction of Putnam Massachusetts i.e., Putnam Massachusetts and Putnam Ohio go up and down completely randomly.
Pair Corralation between Putnam Massachusetts and Putnam Ohio
Assuming the 90 days horizon Putnam Massachusetts Tax is expected to generate 0.95 times more return on investment than Putnam Ohio. However, Putnam Massachusetts Tax is 1.05 times less risky than Putnam Ohio. It trades about -0.02 of its potential returns per unit of risk. Putnam Ohio Tax is currently generating about -0.03 per unit of risk. If you would invest 916.00 in Putnam Massachusetts Tax on August 31, 2024 and sell it today you would lose (3.00) from holding Putnam Massachusetts Tax or give up 0.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Massachusetts Tax vs. Putnam Ohio Tax
Performance |
| Timeline |
| Putnam Massachusetts Tax |
| Putnam Ohio Tax |
Putnam Massachusetts and Putnam Ohio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Massachusetts and Putnam Ohio
The main advantage of trading using opposite Putnam Massachusetts and Putnam Ohio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Massachusetts position performs unexpectedly, Putnam Ohio 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 Ohio will offset losses from the drop in Putnam Ohio's long position.| Putnam Massachusetts vs. T Rowe Price | Putnam Massachusetts vs. Jpmorgan Short Intermediate Municipal | Putnam Massachusetts vs. Maryland Tax Free Bond | Putnam Massachusetts vs. Ambrus Core Bond |
| Putnam Ohio vs. Oppenheimer Gold Special | Putnam Ohio vs. International Investors Gold | Putnam Ohio vs. Europac Gold Fund | Putnam Ohio vs. Gamco Global Gold |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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