Correlation Between Artisan Thematic and Pimco Energy

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

Diversification Opportunities for Artisan Thematic and Pimco Energy

-0.12

Correlation Coefficient

Artisan Thematic  Pimco Energy

Good diversification

The 3 months correlation between Artisan and Pimco is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Pimco Energy Tactical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Energy Tactical 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 Pimco Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Energy Tactical has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Pimco Energy go up and down completely randomly.

Pair Corralation between Artisan Thematic and Pimco Energy

Assuming the 90 days horizon Artisan Thematic Fund is expected to under-perform the Pimco Energy. In addition to that, Artisan Thematic is 1.44 times more volatile than Pimco Energy Tactical. It trades about -0.06 of its total potential returns per unit of risk. Pimco Energy Tactical is currently generating about 0.15 per unit of volatility. If you would invest  2,319  in Pimco Energy Tactical on October 11, 2024 and sell it today you would earn a total of  276.00  from holding Pimco Energy Tactical or generate 11.9% 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.  Pimco Energy Tactical

Artisan Thematic

Risk-Adjusted Performance

0 of 100

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 latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pimco Energy Tactical

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco Energy Tactical are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Pimco Energy may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Artisan Thematic and Pimco Energy

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

The idea behind Artisan Thematic Fund and Pimco Energy Tactical 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.