Correlation Between Thornburg Global and Arrow Managed
Can any of the company-specific risk be diversified away by investing in both Thornburg Global and Arrow Managed 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 Global and Arrow Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg Global Opportunities and Arrow Managed Futures, you can compare the effects of market volatilities on Thornburg Global and Arrow Managed 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 Global with a short position of Arrow Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg Global and Arrow Managed.
Diversification Opportunities for Thornburg Global and Arrow Managed
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thornburg and Arrow is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg Global Opportunities and Arrow Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Managed Futures and Thornburg Global 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 Global Opportunities are associated (or correlated) with Arrow Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Managed Futures has no effect on the direction of Thornburg Global i.e., Thornburg Global and Arrow Managed go up and down completely randomly.
Pair Corralation between Thornburg Global and Arrow Managed
Assuming the 90 days horizon Thornburg Global Opportunities is expected to generate 0.47 times more return on investment than Arrow Managed. However, Thornburg Global Opportunities is 2.12 times less risky than Arrow Managed. It trades about 0.06 of its potential returns per unit of risk. Arrow Managed Futures is currently generating about -0.02 per unit of risk. If you would invest 3,309 in Thornburg Global Opportunities on August 29, 2024 and sell it today you would earn a total of 469.00 from holding Thornburg Global Opportunities or generate 14.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thornburg Global Opportunities vs. Arrow Managed Futures
Performance |
| Timeline |
| Thornburg Global Opp |
| Arrow Managed Futures |
Thornburg Global and Arrow Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg Global and Arrow Managed
The main advantage of trading using opposite Thornburg Global and Arrow Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg Global position performs unexpectedly, Arrow Managed 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 Arrow Managed will offset losses from the drop in Arrow Managed's long position.| Thornburg Global vs. Gabelli Convertible And | Thornburg Global vs. Virtus Convertible | Thornburg Global vs. Rationalpier 88 Convertible | Thornburg Global vs. Lord Abbett Convertible |
| Arrow Managed vs. Pimco Trends Managed | Arrow Managed vs. HUMANA INC | Arrow Managed vs. Aquagold International | Arrow Managed vs. Barloworld Ltd ADR |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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