Correlation Between Thrivent Diversified and Kngt Clb

Can any of the company-specific risk be diversified away by investing in both Thrivent Diversified and Kngt Clb 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 Thrivent Diversified and Kngt Clb into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Thrivent Diversified Income and Kngt Clb Eqy, you can compare the effects of market volatilities on Thrivent Diversified and Kngt Clb 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 Thrivent Diversified with a short position of Kngt Clb. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent Diversified and Kngt Clb.

Diversification Opportunities for Thrivent Diversified and Kngt Clb

0.43

Correlation Coefficient

Thrivent Diversified  Kngt Clb

Very weak diversification

The 3 months correlation between Thrivent and Kngt is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent Diversified Income and Kngt Clb Eqy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kngt Clb Eqy and Thrivent Diversified 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 Thrivent Diversified Income are associated (or correlated) with Kngt Clb. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kngt Clb Eqy has no effect on the direction of Thrivent Diversified i.e., Thrivent Diversified and Kngt Clb go up and down completely randomly.

Pair Corralation between Thrivent Diversified and Kngt Clb

Assuming the 90 days horizon Thrivent Diversified is expected to generate 2.94 times less return on investment than Kngt Clb. But when comparing it to its historical volatility, Thrivent Diversified Income is 1.88 times less risky than Kngt Clb. It trades about 0.14 of its potential returns per unit of risk. Kngt Clb Eqy is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  1,237  in Kngt Clb Eqy on October 25, 2024 and sell it today you would earn a total of  31.00  from holding Kngt Clb Eqy or generate 2.51% return on investment over 90 days.

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

Thrivent Diversified Income  vs.  Kngt Clb Eqy

Thrivent Diversified

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Thrivent Diversified Income are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Thrivent Diversified is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Kngt Clb Eqy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kngt Clb Eqy has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Kngt Clb is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Thrivent Diversified and Kngt Clb

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

The idea behind Thrivent Diversified Income and Kngt Clb Eqy 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..