Correlation Between Thrivent High and BEST
Can any of the company-specific risk be diversified away by investing in both Thrivent High and BEST 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 High and BEST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thrivent High Yield and BEST Inc, you can compare the effects of market volatilities on Thrivent High and BEST 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 High with a short position of BEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent High and BEST.
Diversification Opportunities for Thrivent High and BEST
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thrivent and BEST is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent High Yield and BEST Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BEST Inc and Thrivent High 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 High Yield are associated (or correlated) with BEST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BEST Inc has no effect on the direction of Thrivent High i.e., Thrivent High and BEST go up and down completely randomly.
Pair Corralation between Thrivent High and BEST
Assuming the 90 days horizon Thrivent High Yield is expected to generate 0.43 times more return on investment than BEST. However, Thrivent High Yield is 2.33 times less risky than BEST. It trades about 0.32 of its potential returns per unit of risk. BEST Inc is currently generating about -0.11 per unit of risk. If you would invest 422.00 in Thrivent High Yield on August 27, 2024 and sell it today you would earn a total of 4.00 from holding Thrivent High Yield or generate 0.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thrivent High Yield vs. BEST Inc
Performance |
| Timeline |
| Thrivent High Yield |
| BEST Inc |
Thrivent High and BEST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrivent High and BEST
The main advantage of trading using opposite Thrivent High and BEST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrivent High position performs unexpectedly, BEST 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 BEST will offset losses from the drop in BEST's long position.| Thrivent High vs. Thrivent Limited Maturity | Thrivent High vs. Thrivent Income Fund | Thrivent High vs. Thrivent Large Cap | Thrivent High vs. Thrivent Large Cap |
| BEST vs. Heartland Express | BEST vs. Universal Logistics Holdings | BEST vs. Marten Transport | BEST vs. Werner Enterprises |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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