Correlation Between Thayer Ventures and Full Truck

Can any of the company-specific risk be diversified away by investing in both Thayer Ventures and Full Truck 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 Full Truck 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 Full Truck Alliance, you can compare the effects of market volatilities on Thayer Ventures and Full Truck 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 Full Truck. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thayer Ventures and Full Truck.

Diversification Opportunities for Thayer Ventures and Full Truck

-0.54

Correlation Coefficient

Thayer Ventures  Full Truck

Excellent diversification

The 3 months correlation between Thayer and Full is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Thayer Ventures Acquisition and Full Truck Alliance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Full Truck Alliance 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 Full Truck. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Full Truck Alliance has no effect on the direction of Thayer Ventures i.e., Thayer Ventures and Full Truck go up and down completely randomly.

Pair Corralation between Thayer Ventures and Full Truck

Assuming the 90 days horizon Thayer Ventures Acquisition is expected to generate 4.84 times more return on investment than Full Truck. However, Thayer Ventures is 4.84 times more volatile than Full Truck Alliance. It trades about 0.05 of its potential returns per unit of risk. Full Truck Alliance is currently generating about 0.2 per unit of risk. If you would invest  1.20  in Thayer Ventures Acquisition on September 22, 2024 and sell it today you would lose (0.20) from holding Thayer Ventures Acquisition or give up 16.67% of portfolio value over 90 days.

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

Thayer Ventures Acquisition  vs.  Full Truck Alliance

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 fairly inconsistent basic indicators, Thayer Ventures may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Full Truck Alliance

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Full Truck Alliance are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal primary indicators, Full Truck displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thayer Ventures and Full Truck

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

The idea behind Thayer Ventures Acquisition and Full Truck Alliance 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.