Correlation Between VOXX International and Thayer Ventures

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

By analyzing existing cross correlation between VOXX International and Thayer Ventures Acquisition, you can compare the effects of market volatilities on VOXX International and Thayer Ventures 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 VOXX International with a short position of Thayer Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of VOXX International and Thayer Ventures.

Diversification Opportunities for VOXX International and Thayer Ventures

-0.36

Correlation Coefficient

VOXX International  Thayer Ventures

Very good diversification

The 3 months correlation between VOXX and Thayer is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding VOXX International and Thayer Ventures Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thayer Ventures Acqu and VOXX International 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 VOXX International are associated (or correlated) with Thayer Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thayer Ventures Acqu has no effect on the direction of VOXX International i.e., VOXX International and Thayer Ventures go up and down completely randomly.

Pair Corralation between VOXX International and Thayer Ventures

Given the investment horizon of 90 days VOXX International is expected to generate 28.46 times less return on investment than Thayer Ventures. But when comparing it to its historical volatility, VOXX International is 39.7 times less risky than Thayer Ventures. It trades about 0.12 of its potential returns per unit of risk. Thayer Ventures Acquisition is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  0.90  in Thayer Ventures Acquisition on December 28, 2024 and sell it today you would earn a total of  0.21  from holding Thayer Ventures Acquisition or generate 23.33% return on investment over 90 days.

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

VOXX International  vs.  Thayer Ventures Acquisition

VOXX International

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VOXX International are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, VOXX International is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Thayer Ventures Acqu

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Thayer Ventures Acquisition are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Thayer Ventures showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VOXX International and Thayer Ventures

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

The idea behind VOXX International and Thayer Ventures Acquisition 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.