Correlation Between Hanesbrands and Artisan Global

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

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

Diversification Opportunities for Hanesbrands and Artisan Global

-0.9

Correlation Coefficient

Hanesbrands  Artisan Global

Pay attention - limited upside

The 3 months correlation between Hanesbrands and Artisan is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Artisan Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Global Equity and Hanesbrands 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 Hanesbrands 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 Equity has no effect on the direction of Hanesbrands i.e., Hanesbrands and Artisan Global go up and down completely randomly.

Pair Corralation between Hanesbrands and Artisan Global

Considering the 90-day investment horizon Hanesbrands is expected to under-perform the Artisan Global. In addition to that, Hanesbrands is 3.5 times more volatile than Artisan Global Equity. It trades about -0.15 of its total potential returns per unit of risk. Artisan Global Equity is currently generating about 0.17 per unit of volatility. If you would invest  1,905  in Artisan Global Equity on December 28, 2024 and sell it today you would earn a total of  186.00  from holding Artisan Global Equity or generate 9.76% return on investment over 90 days.

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

Hanesbrands  vs.  Artisan Global Equity

Hanesbrands

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hanesbrands has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Artisan Global Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Global Equity are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical indicators, Artisan Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Hanesbrands and Artisan Global

The main advantage of trading using opposite Hanesbrands and Artisan Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands 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 Hanesbrands and Artisan Global Equity 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.