Correlation Between Thor Industries and Spire Healthcare
Can any of the company-specific risk be diversified away by investing in both Thor Industries and Spire Healthcare 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 Thor Industries and Spire Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thor Industries and Spire Healthcare Group, you can compare the effects of market volatilities on Thor Industries and Spire Healthcare 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 Thor Industries with a short position of Spire Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thor Industries and Spire Healthcare.
Diversification Opportunities for Thor Industries and Spire Healthcare
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thor and Spire is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Thor Industries and Spire Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spire Healthcare and Thor Industries 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 Thor Industries are associated (or correlated) with Spire Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spire Healthcare has no effect on the direction of Thor Industries i.e., Thor Industries and Spire Healthcare go up and down completely randomly.
Pair Corralation between Thor Industries and Spire Healthcare
Assuming the 90 days trading horizon Thor Industries is expected to under-perform the Spire Healthcare. In addition to that, Thor Industries is 2.31 times more volatile than Spire Healthcare Group. It trades about -0.27 of its total potential returns per unit of risk. Spire Healthcare Group is currently generating about 0.14 per unit of volatility. If you would invest 21,650 in Spire Healthcare Group on September 22, 2024 and sell it today you would earn a total of 700.00 from holding Spire Healthcare Group or generate 3.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Thor Industries vs. Spire Healthcare Group
Performance |
| Timeline |
| Thor Industries |
| Spire Healthcare |
Thor Industries and Spire Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thor Industries and Spire Healthcare
The main advantage of trading using opposite Thor Industries and Spire Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thor Industries position performs unexpectedly, Spire Healthcare 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 Spire Healthcare will offset losses from the drop in Spire Healthcare's long position.| Thor Industries vs. Samsung Electronics Co | Thor Industries vs. Samsung Electronics Co | Thor Industries vs. Hyundai Motor | Thor Industries vs. Reliance Industries Ltd |
| Spire Healthcare vs. Silvercorp Metals | Spire Healthcare vs. Metals Exploration Plc | Spire Healthcare vs. GreenX Metals | Spire Healthcare vs. United States Steel |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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