Correlation Between Thrivent Natural and Guggenheim Floating

Can any of the company-specific risk be diversified away by investing in both Thrivent Natural and Guggenheim Floating 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 Guggenheim Floating 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 Guggenheim Floating Rate, you can compare the effects of market volatilities on Thrivent Natural and Guggenheim Floating 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 Guggenheim Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent Natural and Guggenheim Floating.

Diversification Opportunities for Thrivent Natural and Guggenheim Floating

0.43

Correlation Coefficient

Thrivent Natural  Guggenheim Floating

Very weak diversification

The 3 months correlation between Thrivent and Guggenheim is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent Natural Resources and Guggenheim Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Floating Rate 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 Guggenheim Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Floating Rate has no effect on the direction of Thrivent Natural i.e., Thrivent Natural and Guggenheim Floating go up and down completely randomly.

Pair Corralation between Thrivent Natural and Guggenheim Floating

Assuming the 90 days horizon Thrivent Natural is expected to generate 1.53 times less return on investment than Guggenheim Floating. But when comparing it to its historical volatility, Thrivent Natural Resources is 1.66 times less risky than Guggenheim Floating. It trades about 0.2 of its potential returns per unit of risk. Guggenheim Floating Rate is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  2,050  in Guggenheim Floating Rate on October 9, 2024 and sell it today you would earn a total of  377.00  from holding Guggenheim Floating Rate or generate 18.39% return on investment over 90 days.

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

Thrivent Natural Resources  vs.  Guggenheim Floating Rate

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.

Guggenheim Floating Rate

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Floating Rate are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Guggenheim Floating 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 Guggenheim Floating

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

The idea behind Thrivent Natural Resources and Guggenheim Floating Rate 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 CEOs Directory module to screen CEOs from public companies around the world.