Correlation Between Nasdaq-100(r) and Artisan Emerging
Can any of the company-specific risk be diversified away by investing in both Nasdaq-100(r) and Artisan Emerging 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 Nasdaq-100(r) and Artisan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 2x Strategy and Artisan Emerging Markets, you can compare the effects of market volatilities on Nasdaq-100(r) and Artisan Emerging 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 Nasdaq-100(r) with a short position of Artisan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq-100(r) and Artisan Emerging.
Diversification Opportunities for Nasdaq-100(r) and Artisan Emerging
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nasdaq-100(r) and Artisan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 2x Strategy and Artisan Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Emerging Markets and Nasdaq-100(r) 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 Nasdaq 100 2x Strategy are associated (or correlated) with Artisan Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Emerging Markets has no effect on the direction of Nasdaq-100(r) i.e., Nasdaq-100(r) and Artisan Emerging go up and down completely randomly.
Pair Corralation between Nasdaq-100(r) and Artisan Emerging
Assuming the 90 days horizon Nasdaq 100 2x Strategy is expected to generate 11.94 times more return on investment than Artisan Emerging. However, Nasdaq-100(r) is 11.94 times more volatile than Artisan Emerging Markets. It trades about 0.12 of its potential returns per unit of risk. Artisan Emerging Markets is currently generating about 0.26 per unit of risk. If you would invest 38,727 in Nasdaq 100 2x Strategy on August 24, 2024 and sell it today you would earn a total of 2,331 from holding Nasdaq 100 2x Strategy or generate 6.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nasdaq 100 2x Strategy vs. Artisan Emerging Markets
Performance |
| Timeline |
| Nasdaq 100 2x |
| Artisan Emerging Markets |
Nasdaq-100(r) and Artisan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq-100(r) and Artisan Emerging
The main advantage of trading using opposite Nasdaq-100(r) and Artisan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq-100(r) position performs unexpectedly, Artisan Emerging 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 Emerging will offset losses from the drop in Artisan Emerging's long position.| Nasdaq-100(r) vs. Goldman Sachs Large | Nasdaq-100(r) vs. Federated Mdt Large | Nasdaq-100(r) vs. Qs Large Cap | Nasdaq-100(r) vs. Aqr Large Cap |
| Artisan Emerging vs. Fidelity Real Estate | Artisan Emerging vs. Great West Real Estate | Artisan Emerging vs. Prudential Real Estate | Artisan Emerging vs. Neuberger Berman Real |
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 CEOs Directory module to screen CEOs from public companies around the world.
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