Correlation Between Thornburg and Thornburg International
Can any of the company-specific risk be diversified away by investing in both Thornburg and Thornburg International 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 and Thornburg International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg E Growth and Thornburg International Growth, you can compare the effects of market volatilities on Thornburg and Thornburg International 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 with a short position of Thornburg International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg and Thornburg International.
Diversification Opportunities for Thornburg and Thornburg International
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Thornburg and Thornburg is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg E Growth and Thornburg International Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg International and Thornburg 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 E Growth are associated (or correlated) with Thornburg International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg International has no effect on the direction of Thornburg i.e., Thornburg and Thornburg International go up and down completely randomly.
Pair Corralation between Thornburg and Thornburg International
Assuming the 90 days horizon Thornburg E Growth is expected to generate 0.7 times more return on investment than Thornburg International. However, Thornburg E Growth is 1.43 times less risky than Thornburg International. It trades about 0.05 of its potential returns per unit of risk. Thornburg International Growth is currently generating about -0.21 per unit of risk. If you would invest 3,758 in Thornburg E Growth on September 12, 2024 and sell it today you would earn a total of 47.00 from holding Thornburg E Growth or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thornburg E Growth vs. Thornburg International Growth
Performance |
| Timeline |
| Thornburg E Growth |
| Thornburg International |
Thornburg and Thornburg International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg and Thornburg International
The main advantage of trading using opposite Thornburg and Thornburg International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg position performs unexpectedly, Thornburg International 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 International will offset losses from the drop in Thornburg International's long position.| Thornburg vs. Transamerica Emerging Markets | Thornburg vs. Extended Market Index | Thornburg vs. Artisan Emerging Markets | Thornburg vs. Origin Emerging Markets |
| Thornburg International vs. Auer Growth Fund | Thornburg International vs. Issachar Fund Class | Thornburg International vs. Small Cap Stock | Thornburg International vs. Balanced Fund Investor |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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