Correlation Between Strategic Allocation: and Putnam Ohio

Can any of the company-specific risk be diversified away by investing in both Strategic Allocation: 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 Strategic Allocation: and Putnam Ohio into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Strategic Allocation Servative and Putnam Ohio Tax, you can compare the effects of market volatilities on Strategic Allocation: 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 Strategic Allocation: with a short position of Putnam Ohio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Allocation: and Putnam Ohio.

Diversification Opportunities for Strategic Allocation: and Putnam Ohio

0.65

Correlation Coefficient

Strategic Allocation:  Putnam Ohio

Poor diversification

The 3 months correlation between Strategic and Putnam is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Allocation Servative 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 Strategic Allocation: 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 Strategic Allocation Servative 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 Strategic Allocation: i.e., Strategic Allocation: and Putnam Ohio go up and down completely randomly.

Pair Corralation between Strategic Allocation: and Putnam Ohio

Assuming the 90 days horizon Strategic Allocation Servative is expected to under-perform the Putnam Ohio. In addition to that, Strategic Allocation: is 2.78 times more volatile than Putnam Ohio Tax. It trades about -0.15 of its total potential returns per unit of risk. Putnam Ohio Tax is currently generating about -0.02 per unit of volatility. If you would invest  837.00  in Putnam Ohio Tax on October 6, 2024 and sell it today you would lose (2.00) from holding Putnam Ohio Tax or give up 0.24% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	97.62%
Values	Daily Returns

Strategic Allocation Servative  vs.  Putnam Ohio Tax

Strategic Allocation:

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Strategic Allocation Servative has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Strategic Allocation: is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Putnam Ohio Tax

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Putnam Ohio Tax has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical indicators, Putnam Ohio is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Strategic Allocation: and Putnam Ohio

The main advantage of trading using opposite Strategic Allocation: and Putnam Ohio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Allocation: 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.

The idea behind Strategic Allocation Servative and Putnam Ohio Tax pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Global Correlations module to find global opportunities by holding instruments from different markets.