Correlation Between 1919 Financial and Putnam Global
Can any of the company-specific risk be diversified away by investing in both 1919 Financial and Putnam 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 1919 Financial and Putnam Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1919 Financial Services and Putnam Global Health, you can compare the effects of market volatilities on 1919 Financial and Putnam 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 1919 Financial with a short position of Putnam Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1919 Financial and Putnam Global.
Diversification Opportunities for 1919 Financial and Putnam Global
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 1919 and Putnam is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding 1919 Financial Services and Putnam Global Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Global Health and 1919 Financial 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 1919 Financial Services are associated (or correlated) with Putnam Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Global Health has no effect on the direction of 1919 Financial i.e., 1919 Financial and Putnam Global go up and down completely randomly.
Pair Corralation between 1919 Financial and Putnam Global
Assuming the 90 days horizon 1919 Financial Services is expected to generate 1.42 times more return on investment than Putnam Global. However, 1919 Financial is 1.42 times more volatile than Putnam Global Health. It trades about 0.12 of its potential returns per unit of risk. Putnam Global Health is currently generating about 0.05 per unit of risk. If you would invest 2,222 in 1919 Financial Services on August 31, 2024 and sell it today you would earn a total of 1,217 from holding 1919 Financial Services or generate 54.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
1919 Financial Services vs. Putnam Global Health
Performance |
| Timeline |
| 1919 Financial Services |
| Putnam Global Health |
1919 Financial and Putnam Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1919 Financial and Putnam Global
The main advantage of trading using opposite 1919 Financial and Putnam Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1919 Financial position performs unexpectedly, Putnam 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 Putnam Global will offset losses from the drop in Putnam Global's long position.| 1919 Financial vs. Gabelli Global Financial | 1919 Financial vs. Mesirow Financial Small | 1919 Financial vs. Mesirow Financial Small | 1919 Financial vs. Icon Financial Fund |
| Putnam Global vs. 1919 Financial Services | Putnam Global vs. Gabelli Global Financial | Putnam Global vs. Prudential Jennison Financial | Putnam Global vs. Transamerica Financial Life |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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