Correlation Between Artisan Small and New Economy
Can any of the company-specific risk be diversified away by investing in both Artisan Small and New Economy 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 New Economy 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 New Economy Fund, you can compare the effects of market volatilities on Artisan Small and New Economy 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 New Economy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Small and New Economy.
Diversification Opportunities for Artisan Small and New Economy
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Artisan and New is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Small Cap and New Economy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Economy Fund 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 New Economy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Economy Fund has no effect on the direction of Artisan Small i.e., Artisan Small and New Economy go up and down completely randomly.
Pair Corralation between Artisan Small and New Economy
Assuming the 90 days horizon Artisan Small Cap is expected to generate 1.7 times more return on investment than New Economy. However, Artisan Small is 1.7 times more volatile than New Economy Fund. It trades about 0.24 of its potential returns per unit of risk. New Economy Fund is currently generating about 0.17 per unit of risk. If you would invest 3,731 in Artisan Small Cap on September 3, 2024 and sell it today you would earn a total of 271.00 from holding Artisan Small Cap or generate 7.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artisan Small Cap vs. New Economy Fund
Performance |
| Timeline |
| Artisan Small Cap |
| New Economy Fund |
Artisan Small and New Economy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan Small and New Economy
The main advantage of trading using opposite Artisan Small and New Economy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Small position performs unexpectedly, New Economy 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 New Economy will offset losses from the drop in New Economy's long position.| Artisan Small vs. Vanguard Windsor Fund | Artisan Small vs. Americafirst Large Cap | Artisan Small vs. Transamerica Large Cap | Artisan Small vs. Dana Large Cap |
| New Economy vs. Artisan Small Cap | New Economy vs. Tax Managed Mid Small | New Economy vs. Fisher Small Cap | New Economy vs. Rbb Fund |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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