Correlation Between Artisan Partners and GameStop Corp

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

Diversification Opportunities for Artisan Partners and GameStop Corp

-0.04

Correlation Coefficient

Artisan Partners  GameStop Corp

Good diversification

The 3 months correlation between Artisan and GameStop is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Partners Asset and GameStop Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GameStop 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 GameStop Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GameStop Corp has no effect on the direction of Artisan Partners i.e., Artisan Partners and GameStop Corp go up and down completely randomly.

Pair Corralation between Artisan Partners and GameStop Corp

Given the investment horizon of 90 days Artisan Partners is expected to generate 10.6 times less return on investment than GameStop Corp. But when comparing it to its historical volatility, Artisan Partners Asset is 2.06 times less risky than GameStop Corp. It trades about 0.03 of its potential returns per unit of risk. GameStop Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  2,057  in GameStop Corp on October 25, 2024 and sell it today you would earn a total of  708.00  from holding GameStop Corp or generate 34.42% 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.  GameStop Corp

Artisan Partners Asset

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Partners Asset are ranked lower than 2 (%) 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 recent stock price disarray, may contribute to short-term losses for the investors.

GameStop Corp

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GameStop Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent primary indicators, GameStop Corp exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Artisan Partners and GameStop Corp

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

The idea behind Artisan Partners Asset and GameStop 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.