Correlation Between Artisan Emerging and American Beacon
Can any of the company-specific risk be diversified away by investing in both Artisan Emerging and American Beacon 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 Emerging and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artisan Emerging Markets and American Beacon Bridgeway, you can compare the effects of market volatilities on Artisan Emerging and American Beacon 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 Emerging with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Emerging and American Beacon.
Diversification Opportunities for Artisan Emerging and American Beacon
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Artisan and American is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Emerging Markets and American Beacon Bridgeway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Bridgeway and Artisan Emerging 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 Emerging Markets are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Bridgeway has no effect on the direction of Artisan Emerging i.e., Artisan Emerging and American Beacon go up and down completely randomly.
Pair Corralation between Artisan Emerging and American Beacon
Assuming the 90 days horizon Artisan Emerging Markets is expected to under-perform the American Beacon. But the mutual fund apears to be less risky and, when comparing its historical volatility, Artisan Emerging Markets is 1.32 times less risky than American Beacon. The mutual fund trades about -0.22 of its potential returns per unit of risk. The American Beacon Bridgeway is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,685 in American Beacon Bridgeway on August 30, 2024 and sell it today you would earn a total of 171.00 from holding American Beacon Bridgeway or generate 6.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artisan Emerging Markets vs. American Beacon Bridgeway
Performance |
| Timeline |
| Artisan Emerging Markets |
| American Beacon Bridgeway |
Artisan Emerging and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan Emerging and American Beacon
The main advantage of trading using opposite Artisan Emerging and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Emerging position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Artisan Emerging vs. Artisan Global Opportunities | Artisan Emerging vs. Amg River Road | Artisan Emerging vs. Champlain Mid Cap | Artisan Emerging vs. Artisan Value Fund |
| American Beacon vs. Amg Managers Skyline | American Beacon vs. The Hartford International | American Beacon vs. Baird E Plus | American Beacon vs. Artisan Developing World |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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