Correlation Between Thornburg New and Short Precious
Can any of the company-specific risk be diversified away by investing in both Thornburg New and Short Precious 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 New and Short Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg New Mexico and Short Precious Metals, you can compare the effects of market volatilities on Thornburg New and Short Precious 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 New with a short position of Short Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg New and Short Precious.
Diversification Opportunities for Thornburg New and Short Precious
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thornburg and Short is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg New Mexico and Short Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Short Precious Metals and Thornburg New 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 New Mexico are associated (or correlated) with Short Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Short Precious Metals has no effect on the direction of Thornburg New i.e., Thornburg New and Short Precious go up and down completely randomly.
Pair Corralation between Thornburg New and Short Precious
Assuming the 90 days horizon Thornburg New Mexico is expected to generate 0.03 times more return on investment than Short Precious. However, Thornburg New Mexico is 30.61 times less risky than Short Precious. It trades about 0.46 of its potential returns per unit of risk. Short Precious Metals is currently generating about -0.2 per unit of risk. If you would invest 1,239 in Thornburg New Mexico on September 13, 2024 and sell it today you would earn a total of 7.00 from holding Thornburg New Mexico or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thornburg New Mexico vs. Short Precious Metals
Performance |
| Timeline |
| Thornburg New Mexico |
| Short Precious Metals |
Thornburg New and Short Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg New and Short Precious
The main advantage of trading using opposite Thornburg New and Short Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg New position performs unexpectedly, Short Precious 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 Short Precious will offset losses from the drop in Short Precious' long position.| Thornburg New vs. Thornburg Value Fund | Thornburg New vs. Thornburg International Value | Thornburg New vs. Thornburg International Value | Thornburg New vs. Thornburg International Value |
| Short Precious vs. Adams Natural Resources | Short Precious vs. Oil Gas Ultrasector | Short Precious vs. Energy Basic Materials | Short Precious vs. Firsthand Alternative Energy |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |