Correlation Between Malaga Financial and Putnam Money

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

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

Diversification Opportunities for Malaga Financial and Putnam Money

0.0

Correlation Coefficient

Malaga Financial  Putnam Money

Pay attention - limited upside

The 3 months correlation between Malaga and Putnam is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Malaga Financial and Putnam Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Money Market and Malaga 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 Malaga Financial are associated (or correlated) with Putnam Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Money Market has no effect on the direction of Malaga Financial i.e., Malaga Financial and Putnam Money go up and down completely randomly.

Pair Corralation between Malaga Financial and Putnam Money

Given the investment horizon of 90 days Malaga Financial is expected to generate 7.7 times more return on investment than Putnam Money. However, Malaga Financial is 7.7 times more volatile than Putnam Money Market. It trades about 0.03 of its potential returns per unit of risk. Putnam Money Market is currently generating about 0.0 per unit of risk. If you would invest  2,348  in Malaga Financial on October 5, 2024 and sell it today you would lose (108.00) from holding Malaga Financial or give up 4.6% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	81.53%
Values	Daily Returns

Malaga Financial  vs.  Putnam Money Market

Malaga Financial

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Malaga Financial are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Malaga Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Putnam Money Market

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Malaga Financial and Putnam Money

The main advantage of trading using opposite Malaga Financial and Putnam Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malaga Financial position performs unexpectedly, Putnam Money 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 Money will offset losses from the drop in Putnam Money's long position.

The idea behind Malaga Financial and Putnam Money Market 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.