Correlation Between Thrivent High and BlackRock Science

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

By analyzing existing cross correlation between Thrivent High Yield and BlackRock Science and, you can compare the effects of market volatilities on Thrivent High and BlackRock Science 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 Thrivent High with a short position of BlackRock Science. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent High and BlackRock Science.

Diversification Opportunities for Thrivent High and BlackRock Science

0.48

Correlation Coefficient

Thrivent High  BlackRock Science

Very weak diversification

The 3 months correlation between Thrivent and BlackRock is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent High Yield and BlackRock Science and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackRock Science and Thrivent High 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 Thrivent High Yield are associated (or correlated) with BlackRock Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackRock Science has no effect on the direction of Thrivent High i.e., Thrivent High and BlackRock Science go up and down completely randomly.

Pair Corralation between Thrivent High and BlackRock Science

Assuming the 90 days horizon Thrivent High Yield is expected to under-perform the BlackRock Science. But the mutual fund apears to be less risky and, when comparing its historical volatility, Thrivent High Yield is 6.8 times less risky than BlackRock Science. The mutual fund trades about -0.04 of its potential returns per unit of risk. The BlackRock Science and is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  1,834  in BlackRock Science and on September 23, 2024 and sell it today you would earn a total of  267.00  from holding BlackRock Science and or generate 14.56% return on investment over 90 days.

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

Thrivent High Yield  vs.  BlackRock Science and

Thrivent High Yield

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thrivent High Yield has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Thrivent High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

BlackRock Science

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock Science and are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, BlackRock Science showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thrivent High and BlackRock Science

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

The idea behind Thrivent High Yield and BlackRock Science and 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.