Correlation Between Thor Industries and CaliberCos

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

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

Diversification Opportunities for Thor Industries and CaliberCos

-0.18

Correlation Coefficient

Thor Industries  CaliberCos

Good diversification

The 3 months correlation between Thor and CaliberCos is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Thor Industries and CaliberCos Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CaliberCos Class A and Thor Industries 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 Thor Industries are associated (or correlated) with CaliberCos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CaliberCos Class A has no effect on the direction of Thor Industries i.e., Thor Industries and CaliberCos go up and down completely randomly.

Pair Corralation between Thor Industries and CaliberCos

Considering the 90-day investment horizon Thor Industries is expected to generate 0.34 times more return on investment than CaliberCos. However, Thor Industries is 2.91 times less risky than CaliberCos. It trades about 0.03 of its potential returns per unit of risk. CaliberCos Class A is currently generating about -0.02 per unit of risk. If you would invest  10,126  in Thor Industries on September 15, 2024 and sell it today you would earn a total of  335.00  from holding Thor Industries or generate 3.31% return on investment over 90 days.

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

Thor Industries  vs.  CaliberCos Class A

Thor Industries

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Thor Industries are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical indicators, Thor Industries is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

CaliberCos Class A

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CaliberCos Class A has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic 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 Thor Industries and CaliberCos

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

The idea behind Thor Industries and CaliberCos Class A 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.

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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.