Correlation Between Artisan Partners and CapitaLand Investment
Can any of the company-specific risk be diversified away by investing in both Artisan Partners and CapitaLand Investment 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 Artisan Partners and CapitaLand Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artisan Partners Asset and CapitaLand Investment Limited, you can compare the effects of market volatilities on Artisan Partners and CapitaLand Investment 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 Artisan Partners with a short position of CapitaLand Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Partners and CapitaLand Investment.
Diversification Opportunities for Artisan Partners and CapitaLand Investment
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Artisan and CapitaLand is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Partners Asset and CapitaLand Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapitaLand Investment and Artisan Partners 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 Artisan Partners Asset are associated (or correlated) with CapitaLand Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapitaLand Investment has no effect on the direction of Artisan Partners i.e., Artisan Partners and CapitaLand Investment go up and down completely randomly.
Pair Corralation between Artisan Partners and CapitaLand Investment
Given the investment horizon of 90 days Artisan Partners Asset is expected to generate 0.67 times more return on investment than CapitaLand Investment. However, Artisan Partners Asset is 1.49 times less risky than CapitaLand Investment. It trades about 0.08 of its potential returns per unit of risk. CapitaLand Investment Limited is currently generating about -0.01 per unit of risk. If you would invest 4,231 in Artisan Partners Asset on September 19, 2024 and sell it today you would earn a total of 346.00 from holding Artisan Partners Asset or generate 8.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artisan Partners Asset vs. CapitaLand Investment Limited
Performance |
| Timeline |
| Artisan Partners Asset |
| CapitaLand Investment |
Artisan Partners and CapitaLand Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan Partners and CapitaLand Investment
The main advantage of trading using opposite Artisan Partners and CapitaLand Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Partners position performs unexpectedly, CapitaLand Investment 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 CapitaLand Investment will offset losses from the drop in CapitaLand Investment's long position.| Artisan Partners vs. Visa Class A | Artisan Partners vs. Deutsche Bank AG | Artisan Partners vs. Dynex Capital |
| CapitaLand Investment vs. Asia Pptys | CapitaLand Investment vs. Adler Group SA | CapitaLand Investment vs. Ambase Corp | CapitaLand Investment vs. Bridgemarq Real Estate |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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