Correlation Between Thrivent Natural and Prudential California
Can any of the company-specific risk be diversified away by investing in both Thrivent Natural and Prudential California 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 Prudential California 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 Prudential California Muni, you can compare the effects of market volatilities on Thrivent Natural and Prudential California 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 Prudential California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent Natural and Prudential California.
Diversification Opportunities for Thrivent Natural and Prudential California
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Thrivent and Prudential is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent Natural Resources and Prudential California Muni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential California 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 Prudential California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential California has no effect on the direction of Thrivent Natural i.e., Thrivent Natural and Prudential California go up and down completely randomly.
Pair Corralation between Thrivent Natural and Prudential California
Assuming the 90 days horizon Thrivent Natural is expected to generate 5.1 times less return on investment than Prudential California. But when comparing it to its historical volatility, Thrivent Natural Resources is 1.23 times less risky than Prudential California. It trades about 0.1 of its potential returns per unit of risk. Prudential California Muni is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 975.00 in Prudential California Muni on August 29, 2025 and sell it today you would earn a total of 26.00 from holding Prudential California Muni or generate 2.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thrivent Natural Resources vs. Prudential California Muni
Performance |
| Timeline |
| Thrivent Natural Res |
| Prudential California |
Thrivent Natural and Prudential California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrivent Natural and Prudential California
The main advantage of trading using opposite Thrivent Natural and Prudential California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrivent Natural position performs unexpectedly, Prudential California 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 Prudential California will offset losses from the drop in Prudential California's long position.| Thrivent Natural vs. Columbia Real Estate | Thrivent Natural vs. Jhancock Real Estate | Thrivent Natural vs. Deutsche Real Estate | Thrivent Natural vs. Virtus Real Estate |
| Prudential California vs. Ab Government Exchange | Prudential California vs. Cref Money Market | Prudential California vs. Tiaa Cref Life Money | Prudential California vs. Fidelity Money Market |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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