Correlation Between Artisan High and Chautauqua International

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

By analyzing existing cross correlation between Artisan High Income and Chautauqua International Growth, you can compare the effects of market volatilities on Artisan High and Chautauqua International 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 High with a short position of Chautauqua International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan High and Chautauqua International.

Diversification Opportunities for Artisan High and Chautauqua International

0.17

Correlation Coefficient

Artisan High  Chautauqua International

Average diversification

The 3 months correlation between Artisan and Chautauqua is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Artisan High Income and Chautauqua International Growt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chautauqua International and Artisan High 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 High Income are associated (or correlated) with Chautauqua International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chautauqua International has no effect on the direction of Artisan High i.e., Artisan High and Chautauqua International go up and down completely randomly.

Pair Corralation between Artisan High and Chautauqua International

Assuming the 90 days horizon Artisan High is expected to generate 2.74 times less return on investment than Chautauqua International. But when comparing it to its historical volatility, Artisan High Income is 4.11 times less risky than Chautauqua International. It trades about 0.35 of its potential returns per unit of risk. Chautauqua International Growth is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  1,916  in Chautauqua International Growth on October 27, 2024 and sell it today you would earn a total of  67.00  from holding Chautauqua International Growth or generate 3.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Artisan High Income  vs.  Chautauqua International Growt

Artisan High Income

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan High Income are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Artisan High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Chautauqua International

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Chautauqua International Growth are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Chautauqua International 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 High and Chautauqua International

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

The idea behind Artisan High Income and Chautauqua International Growth 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.