Correlation Between Kensington Managed and Artisan Small
Can any of the company-specific risk be diversified away by investing in both Kensington Managed and Artisan Small 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 Kensington Managed and Artisan Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kensington Managed Income and Artisan Small Cap, you can compare the effects of market volatilities on Kensington Managed and Artisan Small 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 Kensington Managed with a short position of Artisan Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kensington Managed and Artisan Small.
Diversification Opportunities for Kensington Managed and Artisan Small
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kensington and Artisan is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Kensington Managed Income and Artisan Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Small Cap and Kensington Managed 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 Kensington Managed Income are associated (or correlated) with Artisan Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Small Cap has no effect on the direction of Kensington Managed i.e., Kensington Managed and Artisan Small go up and down completely randomly.
Pair Corralation between Kensington Managed and Artisan Small
Assuming the 90 days horizon Kensington Managed Income is expected to generate 0.09 times more return on investment than Artisan Small. However, Kensington Managed Income is 11.07 times less risky than Artisan Small. It trades about 0.12 of its potential returns per unit of risk. Artisan Small Cap is currently generating about -0.14 per unit of risk. If you would invest 980.00 in Kensington Managed Income on September 12, 2024 and sell it today you would earn a total of 4.00 from holding Kensington Managed Income or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kensington Managed Income vs. Artisan Small Cap
Performance |
| Timeline |
| Kensington Managed Income |
| Artisan Small Cap |
Kensington Managed and Artisan Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kensington Managed and Artisan Small
The main advantage of trading using opposite Kensington Managed and Artisan Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kensington Managed position performs unexpectedly, Artisan Small 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 Artisan Small will offset losses from the drop in Artisan Small's long position.| Kensington Managed vs. Calamos Dynamic Convertible | Kensington Managed vs. Rationalpier 88 Convertible | Kensington Managed vs. Gabelli Convertible And | Kensington Managed vs. Absolute Convertible Arbitrage |
| Artisan Small vs. Third Avenue Real | Artisan Small vs. Aegis Value Fund | Artisan Small vs. Litman Gregory Masters | Artisan Small vs. Marsico Growth 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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