Correlation Between American Growth and Artisan Small
Can any of the company-specific risk be diversified away by investing in both American Growth and Artisan Small 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 American Growth and Artisan Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Growth Fund and Artisan Small Cap, you can compare the effects of market volatilities on American Growth and Artisan Small 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 American Growth with a short position of Artisan Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Growth and Artisan Small.
Diversification Opportunities for American Growth and Artisan Small
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between American and Artisan is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding American Growth Fund and Artisan Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Small Cap and American Growth 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 American Growth Fund are associated (or correlated) with Artisan Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Small Cap has no effect on the direction of American Growth i.e., American Growth and Artisan Small go up and down completely randomly.
Pair Corralation between American Growth and Artisan Small
Assuming the 90 days horizon American Growth Fund is expected to under-perform the Artisan Small. In addition to that, American Growth is 1.34 times more volatile than Artisan Small Cap. It trades about -0.18 of its total potential returns per unit of risk. Artisan Small Cap is currently generating about -0.14 per unit of volatility. If you would invest 3,918 in Artisan Small Cap on September 12, 2024 and sell it today you would lose (220.00) from holding Artisan Small Cap or give up 5.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
American Growth Fund vs. Artisan Small Cap
Performance |
| Timeline |
| American Growth |
| Artisan Small Cap |
American Growth and Artisan Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Growth and Artisan Small
The main advantage of trading using opposite American Growth and Artisan Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Growth position performs unexpectedly, Artisan Small 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 Artisan Small will offset losses from the drop in Artisan Small's long position.| American Growth vs. Artisan Small Cap | American Growth vs. Pace Smallmedium Growth | American Growth vs. Qs Growth Fund | American Growth vs. Eip Growth And |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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