Correlation Between Thrivent Income and Thrivent Partner

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

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

Diversification Opportunities for Thrivent Income and Thrivent Partner

0.8

Correlation Coefficient

Thrivent Income  Thrivent Partner

Very poor diversification

The 3 months correlation between Thrivent and Thrivent is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent Income Fund and Thrivent Partner Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent Partner Wor and Thrivent Income 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 Income Fund are associated (or correlated) with Thrivent Partner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent Partner Wor has no effect on the direction of Thrivent Income i.e., Thrivent Income and Thrivent Partner go up and down completely randomly.

Pair Corralation between Thrivent Income and Thrivent Partner

Assuming the 90 days horizon Thrivent Income Fund is expected to generate 0.42 times more return on investment than Thrivent Partner. However, Thrivent Income Fund is 2.37 times less risky than Thrivent Partner. It trades about -0.13 of its potential returns per unit of risk. Thrivent Partner Worldwide is currently generating about -0.06 per unit of risk. If you would invest  836.00  in Thrivent Income Fund on September 15, 2024 and sell it today you would lose (21.00) from holding Thrivent Income Fund or give up 2.51% of portfolio value over 90 days.

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

Thrivent Income Fund  vs.  Thrivent Partner Worldwide

Thrivent Income

Risk-Adjusted Performance

0 of 100

Very Weak

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

Thrivent Partner Wor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thrivent Partner Worldwide has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Thrivent Partner 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 Income and Thrivent Partner

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

The idea behind Thrivent Income Fund and Thrivent Partner Worldwide 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.

Check out your portfolio center.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.