Correlation Between Artisan Thematic and Artisan Floating

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

By analyzing existing cross correlation between Artisan Thematic Fund and Artisan Floating Rate, you can compare the effects of market volatilities on Artisan Thematic and Artisan Floating 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 Thematic with a short position of Artisan Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Thematic and Artisan Floating.

Diversification Opportunities for Artisan Thematic and Artisan Floating

0.22

Correlation Coefficient

Artisan Thematic  Artisan Floating

Modest diversification

The 3 months correlation between Artisan and Artisan is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Artisan Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Floating Rate and Artisan Thematic 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 Thematic Fund are associated (or correlated) with Artisan Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Floating Rate has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Artisan Floating go up and down completely randomly.

Pair Corralation between Artisan Thematic and Artisan Floating

Assuming the 90 days horizon Artisan Thematic Fund is expected to under-perform the Artisan Floating. In addition to that, Artisan Thematic is 9.94 times more volatile than Artisan Floating Rate. It trades about -0.02 of its total potential returns per unit of risk. Artisan Floating Rate is currently generating about 0.07 per unit of volatility. If you would invest  942.00  in Artisan Floating Rate on December 30, 2024 and sell it today you would earn a total of  6.00  from holding Artisan Floating Rate or generate 0.64% return on investment over 90 days.

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

Artisan Thematic Fund  vs.  Artisan Floating Rate

Artisan Thematic

Risk-Adjusted Performance

Very Weak

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

Artisan Floating Rate

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Floating Rate are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Artisan Floating 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 Thematic and Artisan Floating

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

The idea behind Artisan Thematic Fund and Artisan Floating Rate 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.