Correlation Between Artisan Thematic and Barings Active

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

Diversification Opportunities for Artisan Thematic and Barings Active

-0.26

Correlation Coefficient

Artisan Thematic  Barings Active

Very good diversification

The 3 months correlation between Artisan and Barings is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Barings Active Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Active Short 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 Barings Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Active Short has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Barings Active go up and down completely randomly.

Pair Corralation between Artisan Thematic and Barings Active

Assuming the 90 days horizon Artisan Thematic Fund is expected to under-perform the Barings Active. In addition to that, Artisan Thematic is 20.24 times more volatile than Barings Active Short. It trades about -0.1 of its total potential returns per unit of risk. Barings Active Short is currently generating about 0.17 per unit of volatility. If you would invest  920.00  in Barings Active Short on November 28, 2024 and sell it today you would earn a total of  9.00  from holding Barings Active Short or generate 0.98% return on investment over 90 days.

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

Artisan Thematic Fund  vs.  Barings Active Short

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 weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Barings Active Short

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Barings Active Short are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Barings Active 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 Barings Active

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

The idea behind Artisan Thematic Fund and Barings Active Short 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.