Correlation Between Oberweis Micro and Artisan Global

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

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

Diversification Opportunities for Oberweis Micro and Artisan Global

0.83

Correlation Coefficient

Oberweis Micro  Artisan Global

Very poor diversification

The 3 months correlation between Oberweis and Artisan is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Oberweis Micro Cap Fund and Artisan Global Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Global Oppor and Oberweis Micro 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 Oberweis Micro Cap Fund 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 Oppor has no effect on the direction of Oberweis Micro i.e., Oberweis Micro and Artisan Global go up and down completely randomly.

Pair Corralation between Oberweis Micro and Artisan Global

Assuming the 90 days horizon Oberweis Micro Cap Fund is expected to generate 1.56 times more return on investment than Artisan Global. However, Oberweis Micro is 1.56 times more volatile than Artisan Global Opportunities. It trades about 0.05 of its potential returns per unit of risk. Artisan Global Opportunities is currently generating about 0.07 per unit of risk. If you would invest  3,841  in Oberweis Micro Cap Fund on September 12, 2024 and sell it today you would earn a total of  960.00  from holding Oberweis Micro Cap Fund or generate 24.99% return on investment over 90 days.

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

Oberweis Micro Cap Fund  vs.  Artisan Global Opportunities

Oberweis Micro Cap

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Oberweis Micro Cap Fund are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Oberweis Micro showed solid returns over the last few months and may actually be approaching a breakup point.

Artisan Global Oppor

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Global Opportunities are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. 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.

Pair Trading with Oberweis Micro and Artisan Global

The main advantage of trading using opposite Oberweis Micro and Artisan Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oberweis Micro 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 Oberweis Micro Cap Fund and Artisan Global Opportunities 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..