Correlation Between Artisan High and Sound Shore
Can any of the company-specific risk be diversified away by investing in both Artisan High and Sound Shore 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 High and Sound Shore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artisan High Income and Sound Shore Fund, you can compare the effects of market volatilities on Artisan High and Sound Shore 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 High with a short position of Sound Shore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan High and Sound Shore.
Diversification Opportunities for Artisan High and Sound Shore
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Artisan and Sound is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Artisan High Income and Sound Shore Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sound Shore Fund and Artisan High 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 High Income are associated (or correlated) with Sound Shore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sound Shore Fund has no effect on the direction of Artisan High i.e., Artisan High and Sound Shore go up and down completely randomly.
Pair Corralation between Artisan High and Sound Shore
Assuming the 90 days horizon Artisan High is expected to generate 1.7 times less return on investment than Sound Shore. But when comparing it to its historical volatility, Artisan High Income is 2.92 times less risky than Sound Shore. It trades about 0.13 of its potential returns per unit of risk. Sound Shore Fund is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,811 in Sound Shore Fund on September 1, 2024 and sell it today you would earn a total of 1,219 from holding Sound Shore Fund or generate 31.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artisan High Income vs. Sound Shore Fund
Performance |
| Timeline |
| Artisan High Income |
| Sound Shore Fund |
Artisan High and Sound Shore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan High and Sound Shore
The main advantage of trading using opposite Artisan High and Sound Shore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan High position performs unexpectedly, Sound Shore 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 Sound Shore will offset losses from the drop in Sound Shore's long position.| Artisan High vs. Artisan Value Income | Artisan High vs. Artisan Developing World | Artisan High vs. Artisan Thematic Fund | Artisan High vs. Artisan Small Cap |
| Sound Shore vs. Neuberger Berman Genesis | Sound Shore vs. T Rowe Price | Sound Shore vs. Putnam High Income | Sound Shore vs. Federated Hermes Conservative |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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