Correlation Between Investec Global and Thrivent Natural
Can any of the company-specific risk be diversified away by investing in both Investec Global and Thrivent Natural 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 Investec Global and Thrivent Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investec Global Franchise and Thrivent Natural Resources, you can compare the effects of market volatilities on Investec Global and Thrivent Natural 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 Investec Global with a short position of Thrivent Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investec Global and Thrivent Natural.
Diversification Opportunities for Investec Global and Thrivent Natural
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Investec and Thrivent is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Investec Global Franchise and Thrivent Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent Natural Res and Investec Global 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 Investec Global Franchise are associated (or correlated) with Thrivent Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent Natural Res has no effect on the direction of Investec Global i.e., Investec Global and Thrivent Natural go up and down completely randomly.
Pair Corralation between Investec Global and Thrivent Natural
Assuming the 90 days horizon Investec Global Franchise is expected to generate 6.87 times more return on investment than Thrivent Natural. However, Investec Global is 6.87 times more volatile than Thrivent Natural Resources. It trades about 0.26 of its potential returns per unit of risk. Thrivent Natural Resources is currently generating about 0.31 per unit of risk. If you would invest 1,785 in Investec Global Franchise on April 23, 2025 and sell it today you would earn a total of 183.00 from holding Investec Global Franchise or generate 10.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Investec Global Franchise vs. Thrivent Natural Resources
Performance |
| Timeline |
| Investec Global Franchise |
| Thrivent Natural Res |
Investec Global and Thrivent Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investec Global and Thrivent Natural
The main advantage of trading using opposite Investec Global and Thrivent Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investec Global position performs unexpectedly, Thrivent Natural 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 Thrivent Natural will offset losses from the drop in Thrivent Natural's long position.| Investec Global vs. Morningstar Global Income | Investec Global vs. Franklin Mutual Global | Investec Global vs. Jhancock Global Equity | Investec Global vs. Gamco Global Opportunity |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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