Correlation Between Auer Growth and Artisan Thematic

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

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

Diversification Opportunities for Auer Growth and Artisan Thematic

0.68

Correlation Coefficient

Auer Growth  Artisan Thematic

Poor diversification

The 3 months correlation between Auer and Artisan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Auer Growth Fund and Artisan Thematic Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Thematic and Auer Growth 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 Auer Growth Fund are associated (or correlated) with Artisan Thematic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Thematic has no effect on the direction of Auer Growth i.e., Auer Growth and Artisan Thematic go up and down completely randomly.

Pair Corralation between Auer Growth and Artisan Thematic

Assuming the 90 days horizon Auer Growth Fund is expected to under-perform the Artisan Thematic. But the mutual fund apears to be less risky and, when comparing its historical volatility, Auer Growth Fund is 1.06 times less risky than Artisan Thematic. The mutual fund trades about -0.04 of its potential returns per unit of risk. The Artisan Thematic Fund is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  2,447  in Artisan Thematic Fund on August 21, 2024 and sell it today you would lose (2.00) from holding Artisan Thematic Fund or give up 0.08% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.45%
Values	Daily Returns

Auer Growth Fund  vs.  Artisan Thematic Fund

Auer Growth Fund

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Auer Growth Fund are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Auer Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Artisan Thematic

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Thematic Fund are ranked lower than 8 (%) 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 December 2024.

Pair Trading with Auer Growth and Artisan Thematic

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

The idea behind Auer Growth Fund and Artisan Thematic Fund 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..