Correlation Between Artisan Thematic and Domini Impact

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

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

Diversification Opportunities for Artisan Thematic and Domini Impact

0.92

Correlation Coefficient

Artisan Thematic  Domini Impact

Almost no diversification

The 3 months correlation between Artisan and Domini is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Thematic Fund and Domini Impact Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Domini Impact Equity and Artisan Thematic 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 Thematic Fund are associated (or correlated) with Domini Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Domini Impact Equity has no effect on the direction of Artisan Thematic i.e., Artisan Thematic and Domini Impact go up and down completely randomly.

Pair Corralation between Artisan Thematic and Domini Impact

Assuming the 90 days horizon Artisan Thematic Fund is expected to generate 1.11 times more return on investment than Domini Impact. However, Artisan Thematic is 1.11 times more volatile than Domini Impact Equity. It trades about 0.12 of its potential returns per unit of risk. Domini Impact Equity is currently generating about 0.12 per unit of risk. If you would invest  1,734  in Artisan Thematic Fund on September 12, 2024 and sell it today you would earn a total of  783.00  from holding Artisan Thematic Fund or generate 45.16% return on investment over 90 days.

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

Artisan Thematic Fund  vs.  Domini Impact Equity

Artisan Thematic

Risk-Adjusted Performance

13 of 100

Good

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

Domini Impact Equity

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Domini Impact Equity are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Domini Impact may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Artisan Thematic and Domini Impact

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

The idea behind Artisan Thematic Fund and Domini Impact 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.