Correlation Between Thayer Ventures and VTEX

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

By analyzing existing cross correlation between Thayer Ventures Acquisition and VTEX, you can compare the effects of market volatilities on Thayer Ventures and VTEX 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 Thayer Ventures with a short position of VTEX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thayer Ventures and VTEX.

Diversification Opportunities for Thayer Ventures and VTEX

0.47

Correlation Coefficient

Thayer Ventures  VTEX

Very weak diversification

The 3 months correlation between Thayer and VTEX is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Thayer Ventures Acquisition and VTEX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VTEX and Thayer Ventures 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 Thayer Ventures Acquisition are associated (or correlated) with VTEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VTEX has no effect on the direction of Thayer Ventures i.e., Thayer Ventures and VTEX go up and down completely randomly.

Pair Corralation between Thayer Ventures and VTEX

Assuming the 90 days horizon Thayer Ventures Acquisition is expected to under-perform the VTEX. In addition to that, Thayer Ventures is 8.52 times more volatile than VTEX. It trades about -0.05 of its total potential returns per unit of risk. VTEX is currently generating about -0.13 per unit of volatility. If you would invest  738.00  in VTEX on September 20, 2024 and sell it today you would lose (118.00) from holding VTEX or give up 15.99% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Thayer Ventures Acquisition  vs.  VTEX

Thayer Ventures Acqu

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thayer Ventures Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

VTEX

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VTEX has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Thayer Ventures and VTEX

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

The idea behind Thayer Ventures Acquisition and VTEX 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.