Correlation Between Inflation Protected and Thrivent Income
Can any of the company-specific risk be diversified away by investing in both Inflation Protected and Thrivent Income 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 Inflation Protected and Thrivent Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inflation Protected Bond Fund and Thrivent Income Fund, you can compare the effects of market volatilities on Inflation Protected and Thrivent Income 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 Inflation Protected with a short position of Thrivent Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inflation Protected and Thrivent Income.
Diversification Opportunities for Inflation Protected and Thrivent Income
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Inflation and Thrivent is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Inflation Protected Bond Fund and Thrivent Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent Income and Inflation Protected 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 Inflation Protected Bond Fund are associated (or correlated) with Thrivent Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent Income has no effect on the direction of Inflation Protected i.e., Inflation Protected and Thrivent Income go up and down completely randomly.
Pair Corralation between Inflation Protected and Thrivent Income
Assuming the 90 days horizon Inflation Protected Bond Fund is expected to generate 1.01 times more return on investment than Thrivent Income. However, Inflation Protected is 1.01 times more volatile than Thrivent Income Fund. It trades about 0.07 of its potential returns per unit of risk. Thrivent Income Fund is currently generating about 0.05 per unit of risk. If you would invest 919.00 in Inflation Protected Bond Fund on September 3, 2024 and sell it today you would earn a total of 137.00 from holding Inflation Protected Bond Fund or generate 14.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inflation Protected Bond Fund vs. Thrivent Income Fund
Performance |
| Timeline |
| Inflation Protected |
| Thrivent Income |
Inflation Protected and Thrivent Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inflation Protected and Thrivent Income
The main advantage of trading using opposite Inflation Protected and Thrivent Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inflation Protected position performs unexpectedly, Thrivent Income 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 Income will offset losses from the drop in Thrivent Income's long position.| Inflation Protected vs. First American Funds | Inflation Protected vs. Hsbc Treasury Money | Inflation Protected vs. Janus Investment | Inflation Protected vs. General 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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