Correlation Between Kaltura and Thor Industries

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

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

Diversification Opportunities for Kaltura and Thor Industries

0.24

Correlation Coefficient

Kaltura  Thor Industries

Modest diversification

The 3 months correlation between Kaltura and Thor is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Kaltura and Thor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Industries and Kaltura 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 Kaltura are associated (or correlated) with Thor Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Industries has no effect on the direction of Kaltura i.e., Kaltura and Thor Industries go up and down completely randomly.

Pair Corralation between Kaltura and Thor Industries

Given the investment horizon of 90 days Kaltura is expected to generate 2.05 times more return on investment than Thor Industries. However, Kaltura is 2.05 times more volatile than Thor Industries. It trades about 0.19 of its potential returns per unit of risk. Thor Industries is currently generating about -0.01 per unit of risk. If you would invest  124.00  in Kaltura on September 18, 2024 and sell it today you would earn a total of  74.00  from holding Kaltura or generate 59.68% return on investment over 90 days.

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

Kaltura  vs.  Thor Industries

Kaltura

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kaltura are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Kaltura reported solid returns over the last few months and may actually be approaching a breakup point.

Thor Industries

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thor Industries has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical indicators, Thor Industries is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Kaltura and Thor Industries

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

The idea behind Kaltura and Thor Industries 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.