Correlation Between Gamco Natural and George Putnam
Can any of the company-specific risk be diversified away by investing in both Gamco Natural 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 Gamco Natural and George Putnam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Natural Resources and George Putnam Fund, you can compare the effects of market volatilities on Gamco Natural 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 Gamco Natural with a short position of George Putnam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Natural and George Putnam.
Diversification Opportunities for Gamco Natural and George Putnam
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gamco and George is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Natural Resources and George Putnam Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on George Putnam and Gamco Natural 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 Gamco Natural Resources 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 Gamco Natural i.e., Gamco Natural and George Putnam go up and down completely randomly.
Pair Corralation between Gamco Natural and George Putnam
Assuming the 90 days horizon Gamco Natural is expected to generate 6.28 times less return on investment than George Putnam. In addition to that, Gamco Natural is 1.48 times more volatile than George Putnam Fund. It trades about 0.01 of its total potential returns per unit of risk. George Putnam Fund is currently generating about 0.11 per unit of volatility. If you would invest 1,963 in George Putnam Fund on September 3, 2024 and sell it today you would earn a total of 623.00 from holding George Putnam Fund or generate 31.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gamco Natural Resources vs. George Putnam Fund
Performance |
| Timeline |
| Gamco Natural Resources |
| George Putnam |
Gamco Natural and George Putnam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco Natural and George Putnam
The main advantage of trading using opposite Gamco Natural and George Putnam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Natural 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.| Gamco Natural vs. Guggenheim Risk Managed | Gamco Natural vs. Great West Real Estate | Gamco Natural vs. Commonwealth Real Estate | Gamco Natural vs. Franklin Real Estate |
| George Putnam vs. Old Westbury Large | George Putnam vs. T Rowe Price | George Putnam vs. Mirova Global Green | George Putnam vs. Principal Lifetime Hybrid |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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