Correlation Between Artisan High and Nebraska Municipal

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

Diversification Opportunities for Artisan High and Nebraska Municipal

0.45

Correlation Coefficient

Artisan High  Nebraska Municipal

Very weak diversification

The 3 months correlation between Artisan and Nebraska is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Artisan High Income and Nebraska Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nebraska Municipal 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 Nebraska Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nebraska Municipal has no effect on the direction of Artisan High i.e., Artisan High and Nebraska Municipal go up and down completely randomly.

Pair Corralation between Artisan High and Nebraska Municipal

Assuming the 90 days horizon Artisan High Income is expected to generate 0.55 times more return on investment than Nebraska Municipal. However, Artisan High Income is 1.8 times less risky than Nebraska Municipal. It trades about 0.17 of its potential returns per unit of risk. Nebraska Municipal Fund is currently generating about 0.01 per unit of risk. If you would invest  899.00  in Artisan High Income on October 23, 2024 and sell it today you would earn a total of  16.00  from holding Artisan High Income or generate 1.78% return on investment over 90 days.

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

Artisan High Income  vs.  Nebraska Municipal Fund

Artisan High Income

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan High Income are ranked lower than 13 (%) 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.

Nebraska Municipal

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nebraska Municipal Fund are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Nebraska Municipal 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 Nebraska Municipal

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

The idea behind Artisan High Income and Nebraska Municipal 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.