Correlation Between Artisan Partners and Glacier Bancorp

Can any of the company-specific risk be diversified away by investing in both Artisan Partners and Glacier Bancorp 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 Glacier Bancorp 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 Glacier Bancorp, you can compare the effects of market volatilities on Artisan Partners and Glacier Bancorp 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 Glacier Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Partners and Glacier Bancorp.

Diversification Opportunities for Artisan Partners and Glacier Bancorp

0.92

Correlation Coefficient

Artisan Partners  Glacier Bancorp

Almost no diversification

The 3 months correlation between Artisan and Glacier is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Partners Asset and Glacier Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glacier Bancorp 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 Glacier Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glacier Bancorp has no effect on the direction of Artisan Partners i.e., Artisan Partners and Glacier Bancorp go up and down completely randomly.

Pair Corralation between Artisan Partners and Glacier Bancorp

Given the investment horizon of 90 days Artisan Partners Asset is expected to generate 0.95 times more return on investment than Glacier Bancorp. However, Artisan Partners Asset is 1.05 times less risky than Glacier Bancorp. It trades about -0.24 of its potential returns per unit of risk. Glacier Bancorp is currently generating about -0.33 per unit of risk. If you would invest  4,746  in Artisan Partners Asset on September 22, 2024 and sell it today you would lose (372.00) from holding Artisan Partners Asset or give up 7.84% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Artisan Partners Asset  vs.  Glacier Bancorp

Artisan Partners Asset

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Partners Asset are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Artisan Partners is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Glacier Bancorp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Glacier Bancorp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile fundamental indicators, Glacier Bancorp may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Artisan Partners and Glacier Bancorp

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

The idea behind Artisan Partners Asset and Glacier Bancorp 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.