Correlation Between Putnam Floating and T Rowe

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

By analyzing existing cross correlation between Putnam Floating Rate and T Rowe Price, you can compare the effects of market volatilities on Putnam Floating and T Rowe 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 Putnam Floating with a short position of T Rowe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Floating and T Rowe.

Diversification Opportunities for Putnam Floating and T Rowe

0.0

Correlation Coefficient

Putnam Floating  T Rowe

Pay attention - limited upside

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

Pair Corralation between Putnam Floating and T Rowe

If you would invest  798.00  in Putnam Floating Rate on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Putnam Floating Rate or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Putnam Floating Rate  vs.  T Rowe Price

Putnam Floating Rate

Risk-Adjusted Performance

0 of 100

Very Weak

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

T Rowe Price

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days T Rowe Price has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Putnam Floating and T Rowe

The main advantage of trading using opposite Putnam Floating and T Rowe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Floating position performs unexpectedly, T Rowe 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 T Rowe will offset losses from the drop in T Rowe's long position.

The idea behind Putnam Floating Rate and T Rowe Price 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.