Correlation Between Thornburg Investment and Small Company
Can any of the company-specific risk be diversified away by investing in both Thornburg Investment and Small Company 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 Investment and Small Company into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg Investment Trust and Small Pany Growth, you can compare the effects of market volatilities on Thornburg Investment and Small Company 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 Investment with a short position of Small Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg Investment and Small Company.
Diversification Opportunities for Thornburg Investment and Small Company
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Thornburg and Small is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg Investment Trust and Small Pany Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Pany Growth and Thornburg Investment 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 Investment Trust are associated (or correlated) with Small Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Pany Growth has no effect on the direction of Thornburg Investment i.e., Thornburg Investment and Small Company go up and down completely randomly.
Pair Corralation between Thornburg Investment and Small Company
Assuming the 90 days horizon Thornburg Investment is expected to generate 17.28 times less return on investment than Small Company. But when comparing it to its historical volatility, Thornburg Investment Trust is 2.71 times less risky than Small Company. It trades about 0.01 of its potential returns per unit of risk. Small Pany Growth is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 875.00 in Small Pany Growth on September 4, 2024 and sell it today you would earn a total of 794.00 from holding Small Pany Growth or generate 90.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 59.72% |
| Values | Daily Returns |
Thornburg Investment Trust vs. Small Pany Growth
Performance |
| Timeline |
| Thornburg Investment |
| Small Pany Growth |
Thornburg Investment and Small Company Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg Investment and Small Company
The main advantage of trading using opposite Thornburg Investment and Small Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg Investment position performs unexpectedly, Small Company 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 Small Company will offset losses from the drop in Small Company's long position.| Thornburg Investment vs. Small Pany Growth | Thornburg Investment vs. Artisan Small Cap | Thornburg Investment vs. Qs Moderate Growth | Thornburg Investment vs. Champlain Mid Cap |
| Small Company vs. Mid Cap Growth | Small Company vs. Growth Portfolio Class | Small Company vs. Morgan Stanley Multi | Small Company vs. Emerging Markets Portfolio |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |