Correlation Between Artisan International and Baird E

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

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

Diversification Opportunities for Artisan International and Baird E

0.72

Correlation Coefficient

Artisan International  Baird E

Poor diversification

The 3 months correlation between Artisan and Baird is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Artisan International Value and Baird E Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baird E Plus and Artisan International 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 International Value are associated (or correlated) with Baird E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baird E Plus has no effect on the direction of Artisan International i.e., Artisan International and Baird E go up and down completely randomly.

Pair Corralation between Artisan International and Baird E

Assuming the 90 days horizon Artisan International Value is expected to under-perform the Baird E. In addition to that, Artisan International is 2.11 times more volatile than Baird E Plus. It trades about -0.25 of its total potential returns per unit of risk. Baird E Plus is currently generating about -0.19 per unit of volatility. If you would invest  1,093  in Baird E Plus on September 27, 2024 and sell it today you would lose (38.00) from holding Baird E Plus or give up 3.48% of portfolio value over 90 days.

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

Artisan International Value  vs.  Baird E Plus

Artisan International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Artisan International Value has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward-looking signals remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Baird E Plus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Baird E Plus has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Baird E 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 International and Baird E

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

The idea behind Artisan International Value and Baird E Plus 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.