Correlation Between Artisan Partners and MOGU

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

Diversification Opportunities for Artisan Partners and MOGU

-0.45

Correlation Coefficient

Artisan Partners  MOGU

Very good diversification

The 3 months correlation between Artisan and MOGU is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Partners Asset and MOGU Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOGU Inc 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 MOGU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOGU Inc has no effect on the direction of Artisan Partners i.e., Artisan Partners and MOGU go up and down completely randomly.

Pair Corralation between Artisan Partners and MOGU

Given the investment horizon of 90 days Artisan Partners is expected to generate 1.64 times less return on investment than MOGU. But when comparing it to its historical volatility, Artisan Partners Asset is 3.02 times less risky than MOGU. It trades about 0.04 of its potential returns per unit of risk. MOGU Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  272.00  in MOGU Inc on October 25, 2024 and sell it today you would lose (13.06) from holding MOGU Inc or give up 4.8% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.58%
Values	Daily Returns

Artisan Partners Asset  vs.  MOGU Inc

Artisan Partners Asset

Risk-Adjusted Performance

3 of 100

Weak

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 recent stock price disarray, may contribute to short-term losses for the investors.

MOGU Inc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MOGU Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal technical and fundamental indicators, MOGU unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Artisan Partners and MOGU

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

The idea behind Artisan Partners Asset and MOGU Inc 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.