Correlation Between Thrivent High and TrueShares Technology

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

By analyzing existing cross correlation between Thrivent High Yield and TrueShares Technology AI, you can compare the effects of market volatilities on Thrivent High and TrueShares Technology 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 High with a short position of TrueShares Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent High and TrueShares Technology.

Diversification Opportunities for Thrivent High and TrueShares Technology

0.49

Correlation Coefficient

Thrivent High  TrueShares Technology

Very weak diversification

The 3 months correlation between Thrivent and TrueShares is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent High Yield and TrueShares Technology AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TrueShares Technology and Thrivent High 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 High Yield are associated (or correlated) with TrueShares Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TrueShares Technology has no effect on the direction of Thrivent High i.e., Thrivent High and TrueShares Technology go up and down completely randomly.

Pair Corralation between Thrivent High and TrueShares Technology

Assuming the 90 days horizon Thrivent High is expected to generate 1061.0 times less return on investment than TrueShares Technology. But when comparing it to its historical volatility, Thrivent High Yield is 10.22 times less risky than TrueShares Technology. It trades about 0.0 of its potential returns per unit of risk. TrueShares Technology AI is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  3,869  in TrueShares Technology AI on October 9, 2024 and sell it today you would earn a total of  227.00  from holding TrueShares Technology AI or generate 5.87% return on investment over 90 days.

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

Thrivent High Yield  vs.  TrueShares Technology AI

Thrivent High Yield

Risk-Adjusted Performance

0 of 100

Very Weak

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

TrueShares Technology

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TrueShares Technology AI are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, TrueShares Technology may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Thrivent High and TrueShares Technology

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

The idea behind Thrivent High Yield and TrueShares Technology AI 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.