Correlation Between Balanced Fund and Thrivent Moderately

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

By analyzing existing cross correlation between Balanced Fund Retail and Thrivent Moderately Aggressive, you can compare the effects of market volatilities on Balanced Fund and Thrivent Moderately 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 Balanced Fund with a short position of Thrivent Moderately. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balanced Fund and Thrivent Moderately.

Diversification Opportunities for Balanced Fund and Thrivent Moderately

0.96

Correlation Coefficient

Balanced Fund  Thrivent Moderately

Almost no diversification

The 3 months correlation between Balanced and Thrivent is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Balanced Fund Retail and Thrivent Moderately Aggressive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent Moderately and Balanced Fund 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 Balanced Fund Retail are associated (or correlated) with Thrivent Moderately. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent Moderately has no effect on the direction of Balanced Fund i.e., Balanced Fund and Thrivent Moderately go up and down completely randomly.

Pair Corralation between Balanced Fund and Thrivent Moderately

Assuming the 90 days horizon Balanced Fund Retail is expected to under-perform the Thrivent Moderately. In addition to that, Balanced Fund is 1.74 times more volatile than Thrivent Moderately Aggressive. It trades about -0.13 of its total potential returns per unit of risk. Thrivent Moderately Aggressive is currently generating about -0.11 per unit of volatility. If you would invest  1,844  in Thrivent Moderately Aggressive on December 1, 2024 and sell it today you would lose (112.00) from holding Thrivent Moderately Aggressive or give up 6.07% of portfolio value over 90 days.

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

Balanced Fund Retail  vs.  Thrivent Moderately Aggressive

Balanced Fund Retail

Risk-Adjusted Performance

Very Weak

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

Thrivent Moderately

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Balanced Fund and Thrivent Moderately

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

The idea behind Balanced Fund Retail and Thrivent Moderately Aggressive 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.