Correlation Between Western Assets and Artisan Emerging
Can any of the company-specific risk be diversified away by investing in both Western Assets 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 Western Assets and Artisan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Assets Emerging and Artisan Emerging Markets, you can compare the effects of market volatilities on Western Assets 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 Western Assets with a short position of Artisan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Assets and Artisan Emerging.
Diversification Opportunities for Western Assets and Artisan Emerging
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Western and Artisan is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Western Assets Emerging 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 Western Assets 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 Western Assets Emerging 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 Western Assets i.e., Western Assets and Artisan Emerging go up and down completely randomly.
Pair Corralation between Western Assets and Artisan Emerging
Assuming the 90 days horizon Western Assets is expected to generate 4.33 times less return on investment than Artisan Emerging. In addition to that, Western Assets is 2.01 times more volatile than Artisan Emerging Markets. It trades about 0.03 of its total potential returns per unit of risk. Artisan Emerging Markets is currently generating about 0.22 per unit of volatility. If you would invest 1,031 in Artisan Emerging Markets on August 27, 2024 and sell it today you would earn a total of 9.00 from holding Artisan Emerging Markets or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Assets Emerging vs. Artisan Emerging Markets
Performance |
| Timeline |
| Western Assets Emerging |
| Artisan Emerging Markets |
Western Assets and Artisan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Assets and Artisan Emerging
The main advantage of trading using opposite Western Assets and Artisan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Assets 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.| Western Assets vs. Moderately Aggressive Balanced | Western Assets vs. Wisdomtree Siegel Moderate | Western Assets vs. Pgim Conservative Retirement | Western Assets vs. Lifestyle Ii Moderate |
| Artisan Emerging vs. Artisan Value Income | Artisan Emerging vs. Artisan Developing World | Artisan Emerging vs. Artisan Thematic Fund | Artisan Emerging vs. Artisan Small Cap |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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