Correlation Between Artisan Floating and Ab Value

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

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

Diversification Opportunities for Artisan Floating and Ab Value

-0.59

Correlation Coefficient

Artisan Floating  Ab Value

Excellent diversification

The 3 months correlation between Artisan and ABVCX is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Floating Rate and Ab Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Value Fund and Artisan Floating 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 Floating Rate are associated (or correlated) with Ab Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Value Fund has no effect on the direction of Artisan Floating i.e., Artisan Floating and Ab Value go up and down completely randomly.

Pair Corralation between Artisan Floating and Ab Value

Assuming the 90 days horizon Artisan Floating Rate is expected to under-perform the Ab Value. But the mutual fund apears to be less risky and, when comparing its historical volatility, Artisan Floating Rate is 16.18 times less risky than Ab Value. The mutual fund trades about -0.41 of its potential returns per unit of risk. The Ab Value Fund is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,815  in Ab Value Fund on December 4, 2024 and sell it today you would earn a total of  3.00  from holding Ab Value Fund or generate 0.17% return on investment over 90 days.

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

Artisan Floating Rate  vs.  Ab Value Fund

Artisan Floating Rate

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Floating Rate are ranked lower than 10 (%) 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.

Ab Value Fund

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ab Value Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Artisan Floating and Ab Value

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

The idea behind Artisan Floating Rate and Ab Value 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.

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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.