Correlation Between Amg River and Artisan Global

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

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

Diversification Opportunities for Amg River and Artisan Global

-0.31

Correlation Coefficient

Amg River  Artisan Global

Very good diversification

The 3 months correlation between AMG and Artisan is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Amg River Road and Artisan Global Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Global Value and Amg River 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 Amg River Road are associated (or correlated) with Artisan Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Global Value has no effect on the direction of Amg River i.e., Amg River and Artisan Global go up and down completely randomly.

Pair Corralation between Amg River and Artisan Global

Assuming the 90 days horizon Amg River Road is expected to under-perform the Artisan Global. In addition to that, Amg River is 1.11 times more volatile than Artisan Global Value. It trades about -0.03 of its total potential returns per unit of risk. Artisan Global Value is currently generating about 0.22 per unit of volatility. If you would invest  2,203  in Artisan Global Value on December 28, 2024 and sell it today you would earn a total of  230.00  from holding Artisan Global Value or generate 10.44% return on investment over 90 days.

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

Amg River Road  vs.  Artisan Global Value

Amg River Road

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amg River Road has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Amg River is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Artisan Global Value

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Global Value are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Artisan Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Amg River and Artisan Global

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

The idea behind Amg River Road and Artisan Global Value 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.