Correlation Between Chia and Thornburg Investment

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

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

Diversification Opportunities for Chia and Thornburg Investment

-0.87

Correlation Coefficient

Chia  Thornburg Investment

Pay attention - limited upside

The 3 months correlation between Chia and Thornburg is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Chia and Thornburg Investment Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg Investment and Chia 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 Chia are associated (or correlated) with Thornburg Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg Investment has no effect on the direction of Chia i.e., Chia and Thornburg Investment go up and down completely randomly.

Pair Corralation between Chia and Thornburg Investment

Assuming the 90 days trading horizon Chia is expected to under-perform the Thornburg Investment. In addition to that, Chia is 10.98 times more volatile than Thornburg Investment Income. It trades about -0.12 of its total potential returns per unit of risk. Thornburg Investment Income is currently generating about 0.32 per unit of volatility. If you would invest  2,515  in Thornburg Investment Income on December 21, 2024 and sell it today you would earn a total of  282.00  from holding Thornburg Investment Income or generate 11.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	93.65%
Values	Daily Returns

Chia  vs.  Thornburg Investment Income

Chia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's technical indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Chia shareholders.

Thornburg Investment

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Thornburg Investment Income are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Thornburg Investment may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Chia and Thornburg Investment

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

The idea behind Chia and Thornburg Investment Income 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.