Correlation Between Artemisome and Amundi MSCI

Can any of the company-specific risk be diversified away by investing in both Artemisome and Amundi MSCI 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 Artemisome and Amundi MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Artemisome I and Amundi MSCI UK, you can compare the effects of market volatilities on Artemisome and Amundi MSCI 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 Artemisome with a short position of Amundi MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artemisome and Amundi MSCI.

Diversification Opportunities for Artemisome and Amundi MSCI

0.66

Correlation Coefficient

Artemisome  Amundi MSCI

Poor diversification

The 3 months correlation between Artemisome and Amundi is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Artemisome I and Amundi MSCI UK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi MSCI UK and Artemisome 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 Artemisome I are associated (or correlated) with Amundi MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi MSCI UK has no effect on the direction of Artemisome i.e., Artemisome and Amundi MSCI go up and down completely randomly.

Pair Corralation between Artemisome and Amundi MSCI

Assuming the 90 days trading horizon Artemisome is expected to generate 1.05 times less return on investment than Amundi MSCI. But when comparing it to its historical volatility, Artemisome I is 1.14 times less risky than Amundi MSCI. It trades about 0.04 of its potential returns per unit of risk. Amundi MSCI UK is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  105,174  in Amundi MSCI UK on September 30, 2024 and sell it today you would earn a total of  14,347  from holding Amundi MSCI UK or generate 13.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

Artemisome I  vs.  Amundi MSCI UK

Artemisome I

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Artemisome I has generated negative risk-adjusted returns adding no value to fund investors. Despite quite persistent forward-looking signals, Artemisome is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Amundi MSCI UK

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amundi MSCI UK has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable basic indicators, Amundi MSCI is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Artemisome and Amundi MSCI

The main advantage of trading using opposite Artemisome and Amundi MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artemisome position performs unexpectedly, Amundi MSCI 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 Amundi MSCI will offset losses from the drop in Amundi MSCI's long position.

The idea behind Artemisome I and Amundi MSCI UK pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.