Correlation Between Eaton Vance and Putnam Ohio

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

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

Diversification Opportunities for Eaton Vance and Putnam Ohio

0.99

Correlation Coefficient

Eaton Vance  Putnam Ohio

No risk reduction

The 3 months correlation between Eaton and Putnam is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Ohio 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 Eaton Vance 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 Eaton Vance Ohio 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 Eaton Vance i.e., Eaton Vance and Putnam Ohio go up and down completely randomly.

Pair Corralation between Eaton Vance and Putnam Ohio

Assuming the 90 days horizon Eaton Vance Ohio is expected to generate 1.01 times more return on investment than Putnam Ohio. However, Eaton Vance is 1.01 times more volatile than Putnam Ohio Tax. It trades about 0.05 of its potential returns per unit of risk. Putnam Ohio Tax is currently generating about 0.05 per unit of risk. If you would invest  818.00  in Eaton Vance Ohio on December 21, 2024 and sell it today you would earn a total of  5.00  from holding Eaton Vance Ohio or generate 0.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Eaton Vance Ohio  vs.  Putnam Ohio Tax

Eaton Vance Ohio

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Ohio are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Eaton Vance 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

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Putnam Ohio Tax are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. 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 Eaton Vance and Putnam Ohio

The main advantage of trading using opposite Eaton Vance and Putnam Ohio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance 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 Eaton Vance Ohio 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.