Correlation Between Thor Industries and Clarus Corp
Can any of the company-specific risk be diversified away by investing in both Thor Industries and Clarus Corp 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 Thor Industries and Clarus Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thor Industries and Clarus Corp, you can compare the effects of market volatilities on Thor Industries and Clarus Corp 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 Thor Industries with a short position of Clarus Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thor Industries and Clarus Corp.
Diversification Opportunities for Thor Industries and Clarus Corp
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Thor and Clarus is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Thor Industries and Clarus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clarus Corp and Thor Industries 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 Thor Industries are associated (or correlated) with Clarus Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clarus Corp has no effect on the direction of Thor Industries i.e., Thor Industries and Clarus Corp go up and down completely randomly.
Pair Corralation between Thor Industries and Clarus Corp
Considering the 90-day investment horizon Thor Industries is expected to generate 0.76 times more return on investment than Clarus Corp. However, Thor Industries is 1.31 times less risky than Clarus Corp. It trades about 0.07 of its potential returns per unit of risk. Clarus Corp is currently generating about -0.1 per unit of risk. If you would invest 9,569 in Thor Industries on September 3, 2024 and sell it today you would earn a total of 1,591 from holding Thor Industries or generate 16.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thor Industries vs. Clarus Corp
Performance |
| Timeline |
| Thor Industries |
| Clarus Corp |
Thor Industries and Clarus Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thor Industries and Clarus Corp
The main advantage of trading using opposite Thor Industries and Clarus Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thor Industries position performs unexpectedly, Clarus Corp 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 Clarus Corp will offset losses from the drop in Clarus Corp's long position.| Thor Industries vs. Marine Products | Thor Industries vs. Malibu Boats | Thor Industries vs. Brunswick | Thor Industries vs. LCI Industries |
| Clarus Corp vs. Vista Outdoor | Clarus Corp vs. Johnson Outdoors | Clarus Corp vs. Escalade Incorporated | Clarus Corp vs. JAKKS Pacific |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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