Correlation Between Artisan Small and Needham Small
Can any of the company-specific risk be diversified away by investing in both Artisan Small and Needham Small 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 Small and Needham Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artisan Small Cap and Needham Small Cap, you can compare the effects of market volatilities on Artisan Small and Needham Small 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 Small with a short position of Needham Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Small and Needham Small.
Diversification Opportunities for Artisan Small and Needham Small
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Artisan and Needham is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Small Cap and Needham Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Needham Small Cap and Artisan Small 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 Small Cap are associated (or correlated) with Needham Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Needham Small Cap has no effect on the direction of Artisan Small i.e., Artisan Small and Needham Small go up and down completely randomly.
Pair Corralation between Artisan Small and Needham Small
Assuming the 90 days horizon Artisan Small is expected to generate 2.71 times less return on investment than Needham Small. But when comparing it to its historical volatility, Artisan Small Cap is 1.79 times less risky than Needham Small. It trades about 0.06 of its potential returns per unit of risk. Needham Small Cap is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,914 in Needham Small Cap on September 11, 2025 and sell it today you would earn a total of 208.00 from holding Needham Small Cap or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artisan Small Cap vs. Needham Small Cap
Performance |
| Timeline |
| Artisan Small Cap |
| Needham Small Cap |
Artisan Small and Needham Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artisan Small and Needham Small
The main advantage of trading using opposite Artisan Small and Needham Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Small position performs unexpectedly, Needham Small 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 Needham Small will offset losses from the drop in Needham Small's long position.| Artisan Small vs. Goldman Sachs Growth | Artisan Small vs. Voya Large Cap Growth | Artisan Small vs. Small Cap Equity | Artisan Small vs. Ridgeworth Ceredex Mid Cap |
| Needham Small vs. Vanguard Small Cap Index | Needham Small vs. Vanguard Small Cap Index | Needham Small vs. Vanguard Small Cap Index | Needham Small vs. Vanguard Small Cap Index |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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