Correlation Between Growth Fund and Artisan International
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Artisan International 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 Growth Fund and Artisan International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Fund Of and Artisan International Fund, you can compare the effects of market volatilities on Growth Fund and Artisan International 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 Growth Fund with a short position of Artisan International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Artisan International.
Diversification Opportunities for Growth Fund and Artisan International
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Growth and Artisan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Artisan International Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan International and Growth Fund 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 Growth Fund Of are associated (or correlated) with Artisan International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan International has no effect on the direction of Growth Fund i.e., Growth Fund and Artisan International go up and down completely randomly.
Pair Corralation between Growth Fund and Artisan International
Assuming the 90 days horizon Growth Fund Of is expected to generate 1.3 times more return on investment than Artisan International. However, Growth Fund is 1.3 times more volatile than Artisan International Fund. It trades about 0.06 of its potential returns per unit of risk. Artisan International Fund is currently generating about 0.03 per unit of risk. If you would invest 6,580 in Growth Fund Of on November 3, 2024 and sell it today you would earn a total of 1,152 from holding Growth Fund Of or generate 17.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Fund Of vs. Artisan International Fund
Performance |
| Timeline |
| Growth Fund |
| Artisan International |
Growth Fund and Artisan International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Artisan International
The main advantage of trading using opposite Growth Fund and Artisan International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Artisan International 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 International will offset losses from the drop in Artisan International's long position.| Growth Fund vs. Mesirow Financial Small | Growth Fund vs. Transamerica Financial Life | Growth Fund vs. John Hancock Financial | Growth Fund vs. Blackstone Secured Lending |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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