Correlation Between Thor Industries and Vista Outdoor
Can any of the company-specific risk be diversified away by investing in both Thor Industries and Vista Outdoor 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 Vista Outdoor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thor Industries and Vista Outdoor, you can compare the effects of market volatilities on Thor Industries and Vista Outdoor 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 Vista Outdoor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thor Industries and Vista Outdoor.
Diversification Opportunities for Thor Industries and Vista Outdoor
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thor and Vista is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Thor Industries and Vista Outdoor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vista Outdoor 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 Vista Outdoor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vista Outdoor has no effect on the direction of Thor Industries i.e., Thor Industries and Vista Outdoor go up and down completely randomly.
Pair Corralation between Thor Industries and Vista Outdoor
Considering the 90-day investment horizon Thor Industries is expected to generate 9.29 times more return on investment than Vista Outdoor. However, Thor Industries is 9.29 times more volatile than Vista Outdoor. It trades about 0.06 of its potential returns per unit of risk. Vista Outdoor is currently generating about 0.33 per unit of risk. If you would invest 10,853 in Thor Industries on August 30, 2024 and sell it today you would earn a total of 260.00 from holding Thor Industries or generate 2.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Thor Industries vs. Vista Outdoor
Performance |
| Timeline |
| Thor Industries |
| Vista Outdoor |
Thor Industries and Vista Outdoor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thor Industries and Vista Outdoor
The main advantage of trading using opposite Thor Industries and Vista Outdoor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thor Industries position performs unexpectedly, Vista Outdoor 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 Vista Outdoor will offset losses from the drop in Vista Outdoor's long position.| Thor Industries vs. Marine Products | Thor Industries vs. Malibu Boats | Thor Industries vs. Brunswick | Thor Industries vs. LCI Industries |
| Vista Outdoor vs. Clarus Corp | Vista Outdoor vs. Johnson Outdoors | Vista Outdoor vs. Escalade Incorporated | Vista Outdoor 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |