Correlation Between Federated Strategic and Artisan Small
Can any of the company-specific risk be diversified away by investing in both Federated Strategic 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 Federated Strategic and Artisan Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Strategic Income and Artisan Small Cap, you can compare the effects of market volatilities on Federated Strategic 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 Federated Strategic with a short position of Artisan Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Strategic and Artisan Small.
Diversification Opportunities for Federated Strategic and Artisan Small
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Federated and Artisan is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Federated Strategic 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 Federated Strategic 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 Federated Strategic 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 Federated Strategic i.e., Federated Strategic and Artisan Small go up and down completely randomly.
Pair Corralation between Federated Strategic and Artisan Small
Assuming the 90 days horizon Federated Strategic is expected to generate 8.52 times less return on investment than Artisan Small. But when comparing it to its historical volatility, Federated Strategic Income is 4.45 times less risky than Artisan Small. It trades about 0.13 of its potential returns per unit of risk. Artisan Small Cap is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 3,731 in Artisan Small Cap on September 4, 2024 and sell it today you would earn a total of 286.00 from holding Artisan Small Cap or generate 7.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Federated Strategic Income vs. Artisan Small Cap
Performance |
| Timeline |
| Federated Strategic |
| Artisan Small Cap |
Federated Strategic and Artisan Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Strategic and Artisan Small
The main advantage of trading using opposite Federated Strategic and Artisan Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Strategic 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.| Federated Strategic vs. Bbh Intermediate Municipal | Federated Strategic vs. Lind Capital Partners | Federated Strategic vs. T Rowe Price | Federated Strategic vs. Ab Impact Municipal |
| Artisan Small vs. Fuller Thaler Behavioral | Artisan Small vs. Small Cap Stock | Artisan Small vs. Legg Mason Bw | Artisan Small vs. Principal Lifetime Hybrid |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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