Correlation Between Artisan Thematic and Victory Munder

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

Diversification Opportunities for Artisan Thematic and Victory Munder

0.91

Correlation Coefficient

Artisan Thematic  Victory Munder

Almost no diversification

The 3 months correlation between Artisan and Victory is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Victory Munder Multi Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Victory Munder Multi 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 Victory Munder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Victory Munder Multi has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Victory Munder go up and down completely randomly.

Pair Corralation between Artisan Thematic and Victory Munder

Assuming the 90 days horizon Artisan Thematic Fund is expected to generate 1.32 times more return on investment than Victory Munder. However, Artisan Thematic is 1.32 times more volatile than Victory Munder Multi Cap. It trades about -0.03 of its potential returns per unit of risk. Victory Munder Multi Cap is currently generating about -0.09 per unit of risk. If you would invest  2,184  in Artisan Thematic Fund on December 29, 2024 and sell it today you would lose (59.00) from holding Artisan Thematic Fund or give up 2.7% of portfolio value over 90 days.

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

Artisan Thematic Fund  vs.  Victory Munder Multi Cap

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.

Victory Munder Multi

Risk-Adjusted Performance

Very Weak

Over the last 90 days Victory Munder Multi Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Victory Munder 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 Victory Munder

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

The idea behind Artisan Thematic Fund and Victory Munder Multi Cap 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.