Correlation Between Sysco Corp and Thor Mining

Can any of the company-specific risk be diversified away by investing in both Sysco Corp and Thor Mining 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 Sysco Corp and Thor Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sysco Corp and Thor Mining PLC, you can compare the effects of market volatilities on Sysco Corp and Thor Mining 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 Sysco Corp with a short position of Thor Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sysco Corp and Thor Mining.

Diversification Opportunities for Sysco Corp and Thor Mining

-0.44

Correlation Coefficient

Sysco Corp  Thor Mining

Very good diversification

The 3 months correlation between Sysco and Thor is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Sysco Corp and Thor Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Mining PLC and Sysco Corp 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 Sysco Corp are associated (or correlated) with Thor Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Mining PLC has no effect on the direction of Sysco Corp i.e., Sysco Corp and Thor Mining go up and down completely randomly.

Pair Corralation between Sysco Corp and Thor Mining

Assuming the 90 days trading horizon Sysco Corp is expected to generate 0.26 times more return on investment than Thor Mining. However, Sysco Corp is 3.86 times less risky than Thor Mining. It trades about 0.09 of its potential returns per unit of risk. Thor Mining PLC is currently generating about -0.03 per unit of risk. If you would invest  7,371  in Sysco Corp on September 19, 2024 and sell it today you would earn a total of  463.00  from holding Sysco Corp or generate 6.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

Sysco Corp  vs.  Thor Mining PLC

Sysco Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sysco Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Sysco Corp is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Thor Mining PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thor Mining PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Sysco Corp and Thor Mining

The main advantage of trading using opposite Sysco Corp and Thor Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sysco Corp position performs unexpectedly, Thor Mining 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 Thor Mining will offset losses from the drop in Thor Mining's long position.

The idea behind Sysco Corp and Thor Mining PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.