Correlation Between Transamerica Emerging and George Putnam
Can any of the company-specific risk be diversified away by investing in both Transamerica Emerging and George Putnam 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 Transamerica Emerging and George Putnam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transamerica Emerging Markets and George Putnam Fund, you can compare the effects of market volatilities on Transamerica Emerging and George Putnam 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 Transamerica Emerging with a short position of George Putnam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transamerica Emerging and George Putnam.
Diversification Opportunities for Transamerica Emerging and George Putnam
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Transamerica and George is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Transamerica Emerging Markets and George Putnam Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on George Putnam and Transamerica Emerging 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 Transamerica Emerging Markets are associated (or correlated) with George Putnam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of George Putnam has no effect on the direction of Transamerica Emerging i.e., Transamerica Emerging and George Putnam go up and down completely randomly.
Pair Corralation between Transamerica Emerging and George Putnam
Assuming the 90 days horizon Transamerica Emerging Markets is expected to generate 0.92 times more return on investment than George Putnam. However, Transamerica Emerging Markets is 1.09 times less risky than George Putnam. It trades about 0.01 of its potential returns per unit of risk. George Putnam Fund is currently generating about -0.16 per unit of risk. If you would invest 818.00 in Transamerica Emerging Markets on September 12, 2024 and sell it today you would earn a total of 1.00 from holding Transamerica Emerging Markets or generate 0.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Transamerica Emerging Markets vs. George Putnam Fund
Performance |
| Timeline |
| Transamerica Emerging |
| George Putnam |
Transamerica Emerging and George Putnam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transamerica Emerging and George Putnam
The main advantage of trading using opposite Transamerica Emerging and George Putnam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transamerica Emerging position performs unexpectedly, George Putnam 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 George Putnam will offset losses from the drop in George Putnam's long position.| Transamerica Emerging vs. American Funds New | Transamerica Emerging vs. SCOR PK | Transamerica Emerging vs. Morningstar Unconstrained Allocation | Transamerica Emerging vs. Via Renewables |
| George Putnam vs. Hewitt Money Market | George Putnam vs. Edward Jones Money | George Putnam vs. Hsbc Treasury Money | George Putnam vs. Ubs Money Series |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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