Correlation Between Thayer Ventures and Carnival

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

By analyzing existing cross correlation between Thayer Ventures Acquisition and Carnival, you can compare the effects of market volatilities on Thayer Ventures and Carnival 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 Thayer Ventures with a short position of Carnival. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thayer Ventures and Carnival.

Diversification Opportunities for Thayer Ventures and Carnival

0.52

Correlation Coefficient

Thayer Ventures  Carnival

Very weak diversification

The 3 months correlation between Thayer and Carnival is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Thayer Ventures Acquisition and Carnival in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnival and Thayer Ventures 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 Thayer Ventures Acquisition are associated (or correlated) with Carnival. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnival has no effect on the direction of Thayer Ventures i.e., Thayer Ventures and Carnival go up and down completely randomly.

Pair Corralation between Thayer Ventures and Carnival

Assuming the 90 days horizon Thayer Ventures Acquisition is expected to generate 3.79 times more return on investment than Carnival. However, Thayer Ventures is 3.79 times more volatile than Carnival. It trades about 0.08 of its potential returns per unit of risk. Carnival is currently generating about -0.1 per unit of risk. If you would invest  0.90  in Thayer Ventures Acquisition on December 29, 2024 and sell it today you would earn a total of  0.20  from holding Thayer Ventures Acquisition or generate 22.22% return on investment over 90 days.

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

Thayer Ventures Acquisition  vs.  Carnival

Thayer Ventures Acqu

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Thayer Ventures Acquisition are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Thayer Ventures showed solid returns over the last few months and may actually be approaching a breakup point.

Carnival

Risk-Adjusted Performance

Very Weak

Over the last 90 days Carnival has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Thayer Ventures and Carnival

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

The idea behind Thayer Ventures Acquisition and Carnival 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.