Correlation Between Artisan Partners and Fidus Investment

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

By analyzing existing cross correlation between Artisan Partners Asset and Fidus Investment Corp, you can compare the effects of market volatilities on Artisan Partners and Fidus Investment 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 Artisan Partners with a short position of Fidus Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Partners and Fidus Investment.

Diversification Opportunities for Artisan Partners and Fidus Investment

-0.02

Correlation Coefficient

Artisan Partners  Fidus Investment

Good diversification

The 3 months correlation between Artisan and Fidus is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Partners Asset and Fidus Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidus Investment Corp and Artisan Partners 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 Artisan Partners Asset are associated (or correlated) with Fidus Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidus Investment Corp has no effect on the direction of Artisan Partners i.e., Artisan Partners and Fidus Investment go up and down completely randomly.

Pair Corralation between Artisan Partners and Fidus Investment

Given the investment horizon of 90 days Artisan Partners Asset is expected to under-perform the Fidus Investment. In addition to that, Artisan Partners is 1.89 times more volatile than Fidus Investment Corp. It trades about -0.09 of its total potential returns per unit of risk. Fidus Investment Corp is currently generating about 0.39 per unit of volatility. If you would invest  2,057  in Fidus Investment Corp on October 22, 2024 and sell it today you would earn a total of  113.00  from holding Fidus Investment Corp or generate 5.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Artisan Partners Asset  vs.  Fidus Investment Corp

Artisan Partners Asset

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Artisan Partners Asset has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Artisan Partners is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Fidus Investment Corp

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fidus Investment Corp are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Fidus Investment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Artisan Partners and Fidus Investment

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

The idea behind Artisan Partners Asset and Fidus Investment Corp 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.