Correlation Between FactSet Research and Thor Industries
Can any of the company-specific risk be diversified away by investing in both FactSet Research and Thor Industries 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 FactSet Research and Thor Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FactSet Research Systems and Thor Industries, you can compare the effects of market volatilities on FactSet Research and Thor Industries 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 FactSet Research with a short position of Thor Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of FactSet Research and Thor Industries.
Diversification Opportunities for FactSet Research and Thor Industries
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FactSet and Thor is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding FactSet Research Systems and Thor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Industries and FactSet Research 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 FactSet Research Systems are associated (or correlated) with Thor Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Industries has no effect on the direction of FactSet Research i.e., FactSet Research and Thor Industries go up and down completely randomly.
Pair Corralation between FactSet Research and Thor Industries
Considering the 90-day investment horizon FactSet Research Systems is expected to generate 0.52 times more return on investment than Thor Industries. However, FactSet Research Systems is 1.92 times less risky than Thor Industries. It trades about 0.05 of its potential returns per unit of risk. Thor Industries is currently generating about -0.21 per unit of risk. If you would invest 48,490 in FactSet Research Systems on September 19, 2024 and sell it today you would earn a total of 391.00 from holding FactSet Research Systems or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FactSet Research Systems vs. Thor Industries
Performance |
| Timeline |
| FactSet Research Systems |
| Thor Industries |
FactSet Research and Thor Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FactSet Research and Thor Industries
The main advantage of trading using opposite FactSet Research and Thor Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FactSet Research position performs unexpectedly, Thor Industries 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 Thor Industries will offset losses from the drop in Thor Industries' long position.| FactSet Research vs. Dun Bradstreet Holdings | FactSet Research vs. Moodys | FactSet Research vs. MSCI Inc | FactSet Research vs. Intercontinental Exchange |
| Thor Industries vs. Marine Products | Thor Industries vs. Malibu Boats | Thor Industries vs. Brunswick | Thor Industries vs. LCI Industries |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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