Correlation Between Thrivent Natural and Rbb Fund

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

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

Diversification Opportunities for Thrivent Natural and Rbb Fund

0.05

Correlation Coefficient

Thrivent Natural  Rbb Fund

Significant diversification

The 3 months correlation between Thrivent and Rbb is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent Natural Resources and Rbb Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbb Fund and Thrivent Natural 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 Natural Resources are associated (or correlated) with Rbb Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbb Fund has no effect on the direction of Thrivent Natural i.e., Thrivent Natural and Rbb Fund go up and down completely randomly.

Pair Corralation between Thrivent Natural and Rbb Fund

Assuming the 90 days horizon Thrivent Natural Resources is expected to generate 0.35 times more return on investment than Rbb Fund. However, Thrivent Natural Resources is 2.87 times less risky than Rbb Fund. It trades about -0.05 of its potential returns per unit of risk. Rbb Fund is currently generating about -0.1 per unit of risk. If you would invest  1,001  in Thrivent Natural Resources on October 8, 2024 and sell it today you would lose (7.00) from holding Thrivent Natural Resources or give up 0.7% of portfolio value over 90 days.

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

Thrivent Natural Resources  vs.  Rbb Fund

Thrivent Natural Res

Risk-Adjusted Performance

0 of 100

Very Weak

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

Rbb Fund

Risk-Adjusted Performance

0 of 100

Very Weak

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

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

The idea behind Thrivent Natural Resources and Rbb Fund 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.