Correlation Between Thornburg International and Thornburg Strategic
Can any of the company-specific risk be diversified away by investing in both Thornburg International and Thornburg Strategic 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 Thornburg International and Thornburg Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg International Value and Thornburg Strategic Income, you can compare the effects of market volatilities on Thornburg International and Thornburg Strategic 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 Thornburg International with a short position of Thornburg Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg International and Thornburg Strategic.
Diversification Opportunities for Thornburg International and Thornburg Strategic
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thornburg and Thornburg is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg International Value and Thornburg Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg Strategic and Thornburg International 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 Thornburg International Value are associated (or correlated) with Thornburg Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg Strategic has no effect on the direction of Thornburg International i.e., Thornburg International and Thornburg Strategic go up and down completely randomly.
Pair Corralation between Thornburg International and Thornburg Strategic
Assuming the 90 days horizon Thornburg International Value is expected to under-perform the Thornburg Strategic. In addition to that, Thornburg International is 6.68 times more volatile than Thornburg Strategic Income. It trades about -0.08 of its total potential returns per unit of risk. Thornburg Strategic Income is currently generating about 0.1 per unit of volatility. If you would invest 1,141 in Thornburg Strategic Income on September 14, 2024 and sell it today you would earn a total of 4.00 from holding Thornburg Strategic Income or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Thornburg International Value vs. Thornburg Strategic Income
Performance |
| Timeline |
| Thornburg International |
| Thornburg Strategic |
Thornburg International and Thornburg Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg International and Thornburg Strategic
The main advantage of trading using opposite Thornburg International and Thornburg Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg International position performs unexpectedly, Thornburg Strategic 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 Thornburg Strategic will offset losses from the drop in Thornburg Strategic's long position.| Thornburg International vs. Total Return Fund | Thornburg International vs. Blackrock Gbl Alloc | Thornburg International vs. Blackrock Eq Dividend | Thornburg International vs. Davis New York |
| Thornburg Strategic vs. Thornburg Value Fund | Thornburg Strategic vs. Thornburg Value Fund | Thornburg Strategic vs. Thornburg International Value | Thornburg Strategic vs. Thornburg International Value |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |