Correlation Between The Gold and Thrivent Natural
Can any of the company-specific risk be diversified away by investing in both The Gold and Thrivent Natural 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 The Gold and Thrivent Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Gold Bullion and Thrivent Natural Resources, you can compare the effects of market volatilities on The Gold and Thrivent Natural 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 The Gold with a short position of Thrivent Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Gold and Thrivent Natural.
Diversification Opportunities for The Gold and Thrivent Natural
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between The and Thrivent is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding The Gold Bullion and Thrivent Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent Natural Res and The Gold 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 The Gold Bullion are associated (or correlated) with Thrivent Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent Natural Res has no effect on the direction of The Gold i.e., The Gold and Thrivent Natural go up and down completely randomly.
Pair Corralation between The Gold and Thrivent Natural
Assuming the 90 days horizon The Gold is expected to generate 1.32 times less return on investment than Thrivent Natural. In addition to that, The Gold is 11.91 times more volatile than Thrivent Natural Resources. It trades about 0.01 of its total potential returns per unit of risk. Thrivent Natural Resources is currently generating about 0.2 per unit of volatility. If you would invest 892.00 in Thrivent Natural Resources on October 14, 2024 and sell it today you would earn a total of 103.00 from holding Thrivent Natural Resources or generate 11.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Gold Bullion vs. Thrivent Natural Resources
Performance |
| Timeline |
| Gold Bullion |
| Thrivent Natural Res |
The Gold and Thrivent Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Gold and Thrivent Natural
The main advantage of trading using opposite The Gold and Thrivent Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Gold position performs unexpectedly, Thrivent Natural 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 Natural will offset losses from the drop in Thrivent Natural's long position.| The Gold vs. Spectrum Advisors Preferred | The Gold vs. Ontrack E Fund | The Gold vs. Ontrack E Fund | The Gold vs. Quantified Market Leaders |
| Thrivent Natural vs. Oppenheimer Gold Special | Thrivent Natural vs. The Gold Bullion | Thrivent Natural vs. Gamco Global Gold | Thrivent Natural vs. Fidelity Advisor Gold |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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