Correlation Between Artisan Small and Glg Intl
Can any of the company-specific risk be diversified away by investing in both Artisan Small and Glg Intl 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 Small and Glg Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artisan Small Cap and Glg Intl Small, you can compare the effects of market volatilities on Artisan Small and Glg Intl 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 Small with a short position of Glg Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Small and Glg Intl.
Diversification Opportunities for Artisan Small and Glg Intl
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Artisan and Glg is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Small Cap and Glg Intl Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glg Intl Small and Artisan Small 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 Small Cap are associated (or correlated) with Glg Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glg Intl Small has no effect on the direction of Artisan Small i.e., Artisan Small and Glg Intl go up and down completely randomly.
Pair Corralation between Artisan Small and Glg Intl
Assuming the 90 days horizon Artisan Small Cap is expected to generate 1.35 times more return on investment than Glg Intl. However, Artisan Small is 1.35 times more volatile than Glg Intl Small. It trades about 0.16 of its potential returns per unit of risk. Glg Intl Small is currently generating about 0.09 per unit of risk. If you would invest 3,552 in Artisan Small Cap on August 28, 2024 and sell it today you would earn a total of 465.00 from holding Artisan Small Cap or generate 13.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artisan Small Cap vs. Glg Intl Small
Performance |
| Timeline |
| Artisan Small Cap |
| Glg Intl Small |
Artisan Small and Glg Intl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan Small and Glg Intl
The main advantage of trading using opposite Artisan Small and Glg Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Small position performs unexpectedly, Glg Intl 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 Glg Intl will offset losses from the drop in Glg Intl's long position.| Artisan Small vs. Touchstone Small Cap | Artisan Small vs. Rbc Small Cap | Artisan Small vs. Templeton Global Smaller | Artisan Small vs. Glg Intl Small |
| Glg Intl vs. Dws Emerging Markets | Glg Intl vs. Western Assets Emerging | Glg Intl vs. Eagle Mlp Strategy | Glg Intl vs. Franklin Emerging Market |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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