Correlation Between Artisan High and Loomis Sayles

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

By analyzing existing cross correlation between Artisan High Income and Loomis Sayles E, you can compare the effects of market volatilities on Artisan High and Loomis Sayles 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 High with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan High and Loomis Sayles.

Diversification Opportunities for Artisan High and Loomis Sayles

0.74

Correlation Coefficient

Artisan High  Loomis Sayles

Poor diversification

The 3 months correlation between Artisan and Loomis is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Artisan High Income and Loomis Sayles E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles E and Artisan High 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 High Income are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles E has no effect on the direction of Artisan High i.e., Artisan High and Loomis Sayles go up and down completely randomly.

Pair Corralation between Artisan High and Loomis Sayles

Assuming the 90 days horizon Artisan High is expected to generate 1.92 times less return on investment than Loomis Sayles. But when comparing it to its historical volatility, Artisan High Income is 1.56 times less risky than Loomis Sayles. It trades about 0.1 of its potential returns per unit of risk. Loomis Sayles E is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,126  in Loomis Sayles E on December 29, 2024 and sell it today you would earn a total of  27.00  from holding Loomis Sayles E or generate 2.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

Artisan High Income  vs.  Loomis Sayles E

Artisan High Income

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan High Income are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Artisan High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Loomis Sayles E

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Loomis Sayles E are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Loomis Sayles is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Artisan High and Loomis Sayles

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

The idea behind Artisan High Income and Loomis Sayles E 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.