Correlation Between Artisan Global and Aqr International

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

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

Diversification Opportunities for Artisan Global and Aqr International

-0.21

Correlation Coefficient

Artisan Global  Aqr International

Very good diversification

The 3 months correlation between Artisan and Aqr is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Global Opportunities and Aqr International Defensive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr International and Artisan Global 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 Global Opportunities are associated (or correlated) with Aqr International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr International has no effect on the direction of Artisan Global i.e., Artisan Global and Aqr International go up and down completely randomly.

Pair Corralation between Artisan Global and Aqr International

Assuming the 90 days horizon Artisan Global Opportunities is expected to under-perform the Aqr International. In addition to that, Artisan Global is 1.71 times more volatile than Aqr International Defensive. It trades about -0.03 of its total potential returns per unit of risk. Aqr International Defensive is currently generating about 0.19 per unit of volatility. If you would invest  1,457  in Aqr International Defensive on December 28, 2024 and sell it today you would earn a total of  114.00  from holding Aqr International Defensive or generate 7.82% return on investment over 90 days.

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

Artisan Global Opportunities  vs.  Aqr International Defensive

Artisan Global Oppor

Risk-Adjusted Performance

Very Weak

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

Aqr International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aqr International Defensive are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Aqr International may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Artisan Global and Aqr International

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

The idea behind Artisan Global Opportunities and Aqr International Defensive 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.