Correlation Between Artisan Thematic and Dreyfus Gnma

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

Diversification Opportunities for Artisan Thematic and Dreyfus Gnma

-0.4

Correlation Coefficient

Artisan Thematic  Dreyfus Gnma

Very good diversification

The 3 months correlation between Artisan and Dreyfus is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Dreyfus Gnma Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Gnma 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 Dreyfus Gnma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Gnma has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Dreyfus Gnma go up and down completely randomly.

Pair Corralation between Artisan Thematic and Dreyfus Gnma

Assuming the 90 days horizon Artisan Thematic Fund is expected to under-perform the Dreyfus Gnma. In addition to that, Artisan Thematic is 4.61 times more volatile than Dreyfus Gnma Fund. It trades about -0.02 of its total potential returns per unit of risk. Dreyfus Gnma Fund is currently generating about 0.12 per unit of volatility. If you would invest  1,254  in Dreyfus Gnma Fund on December 30, 2024 and sell it today you would earn a total of  29.00  from holding Dreyfus Gnma Fund or generate 2.31% return on investment over 90 days.

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

Artisan Thematic Fund  vs.  Dreyfus Gnma Fund

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.

Dreyfus Gnma

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dreyfus Gnma Fund are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Dreyfus Gnma 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 Dreyfus Gnma

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

The idea behind Artisan Thematic Fund and Dreyfus Gnma Fund 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.