Correlation Between Thrivent High and National Bank
Can any of the company-specific risk be diversified away by investing in both Thrivent High and National Bank 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 National Bank 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 National Bank of, you can compare the effects of market volatilities on Thrivent High and National Bank 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 National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent High and National Bank.
Diversification Opportunities for Thrivent High and National Bank
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Thrivent and National is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent High Yield and National Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank 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 National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank has no effect on the direction of Thrivent High i.e., Thrivent High and National Bank go up and down completely randomly.
Pair Corralation between Thrivent High and National Bank
Assuming the 90 days horizon Thrivent High is expected to generate 4.19 times less return on investment than National Bank. But when comparing it to its historical volatility, Thrivent High Yield is 4.46 times less risky than National Bank. It trades about 0.15 of its potential returns per unit of risk. National Bank of is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 7,282 in National Bank of on September 3, 2024 and sell it today you would earn a total of 2,622 from holding National Bank of or generate 36.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thrivent High Yield vs. National Bank of
Performance |
| Timeline |
| Thrivent High Yield |
| National Bank |
Thrivent High and National Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrivent High and National Bank
The main advantage of trading using opposite Thrivent High and National Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrivent High position performs unexpectedly, National Bank 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 National Bank will offset losses from the drop in National Bank'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 |
| National Bank vs. Barclays PLC ADR | National Bank vs. Banco Bilbao Viscaya | National Bank vs. Banco Santander SA | National Bank vs. UBS Group AG |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |