Correlation Between Artisan Small and Jhancock Multimanager
Can any of the company-specific risk be diversified away by investing in both Artisan Small and Jhancock Multimanager 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 Jhancock Multimanager 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 Jhancock Multimanager 2065, you can compare the effects of market volatilities on Artisan Small and Jhancock Multimanager 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 Jhancock Multimanager. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Small and Jhancock Multimanager.
Diversification Opportunities for Artisan Small and Jhancock Multimanager
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Artisan and Jhancock is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Small Cap and Jhancock Multimanager 2065 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Multimanager 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 Jhancock Multimanager. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Multimanager has no effect on the direction of Artisan Small i.e., Artisan Small and Jhancock Multimanager go up and down completely randomly.
Pair Corralation between Artisan Small and Jhancock Multimanager
Assuming the 90 days horizon Artisan Small Cap is expected to under-perform the Jhancock Multimanager. In addition to that, Artisan Small is 4.13 times more volatile than Jhancock Multimanager 2065. It trades about -0.1 of its total potential returns per unit of risk. Jhancock Multimanager 2065 is currently generating about 0.11 per unit of volatility. If you would invest 1,382 in Jhancock Multimanager 2065 on September 13, 2024 and sell it today you would earn a total of 13.00 from holding Jhancock Multimanager 2065 or generate 0.94% 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. Jhancock Multimanager 2065
Performance |
| Timeline |
| Artisan Small Cap |
| Jhancock Multimanager |
Artisan Small and Jhancock Multimanager Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan Small and Jhancock Multimanager
The main advantage of trading using opposite Artisan Small and Jhancock Multimanager positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Small position performs unexpectedly, Jhancock Multimanager 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 Jhancock Multimanager will offset losses from the drop in Jhancock Multimanager's long position.| Artisan Small vs. Artisan Global Opportunities | Artisan Small vs. Wasatch Ultra Growth | Artisan Small vs. Artisan International Value | Artisan Small vs. Artisan Mid Cap |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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