Correlation Between Thor Industries and Veren

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

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

Diversification Opportunities for Thor Industries and Veren

-0.58

Correlation Coefficient

Thor Industries  Veren

Excellent diversification

The 3 months correlation between Thor and Veren is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Thor Industries and Veren Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veren Inc and Thor Industries 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 Thor Industries are associated (or correlated) with Veren. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veren Inc has no effect on the direction of Thor Industries i.e., Thor Industries and Veren go up and down completely randomly.

Pair Corralation between Thor Industries and Veren

Considering the 90-day investment horizon Thor Industries is expected to under-perform the Veren. But the stock apears to be less risky and, when comparing its historical volatility, Thor Industries is 1.19 times less risky than Veren. The stock trades about -0.09 of its potential returns per unit of risk. The Veren Inc is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  491.00  in Veren Inc on December 26, 2024 and sell it today you would earn a total of  177.00  from holding Veren Inc or generate 36.05% return on investment over 90 days.

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

Thor Industries  vs.  Veren Inc

Thor Industries

Risk-Adjusted Performance

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 weak performance in the last few months, the Stock's technical indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Veren Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Veren Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Veren displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thor Industries and Veren

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

The idea behind Thor Industries and Veren Inc 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..