Correlation Between Artisan Select and Guidemark

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

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

Diversification Opportunities for Artisan Select and Guidemark

0.05

Correlation Coefficient

Artisan Select  Guidemark

Significant diversification

The 3 months correlation between Artisan and Guidemark is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Select Equity and Guidemark E Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidemark E Fixed and Artisan Select 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 Select Equity are associated (or correlated) with Guidemark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidemark E Fixed has no effect on the direction of Artisan Select i.e., Artisan Select and Guidemark go up and down completely randomly.

Pair Corralation between Artisan Select and Guidemark

Assuming the 90 days horizon Artisan Select Equity is expected to under-perform the Guidemark. In addition to that, Artisan Select is 2.83 times more volatile than Guidemark E Fixed. It trades about -0.3 of its total potential returns per unit of risk. Guidemark E Fixed is currently generating about -0.25 per unit of volatility. If you would invest  828.00  in Guidemark E Fixed on September 28, 2024 and sell it today you would lose (11.00) from holding Guidemark E Fixed or give up 1.33% of portfolio value over 90 days.

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

Artisan Select Equity  vs.  Guidemark E Fixed

Artisan Select Equity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Artisan Select Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Artisan Select is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Guidemark E Fixed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guidemark E Fixed has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Guidemark 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 Select and Guidemark

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

The idea behind Artisan Select Equity and Guidemark E Fixed 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.