Correlation Between Haverty Furniture and Jerónimo Martins
Can any of the company-specific risk be diversified away by investing in both Haverty Furniture and Jerónimo Martins 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 Haverty Furniture and Jerónimo Martins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haverty Furniture Companies and Jernimo Martins SGPS, you can compare the effects of market volatilities on Haverty Furniture and Jerónimo Martins 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 Haverty Furniture with a short position of Jerónimo Martins. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haverty Furniture and Jerónimo Martins.
Diversification Opportunities for Haverty Furniture and Jerónimo Martins
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Haverty and Jerónimo is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Haverty Furniture Companies and Jernimo Martins SGPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jernimo Martins SGPS and Haverty Furniture 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 Haverty Furniture Companies are associated (or correlated) with Jerónimo Martins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jernimo Martins SGPS has no effect on the direction of Haverty Furniture i.e., Haverty Furniture and Jerónimo Martins go up and down completely randomly.
Pair Corralation between Haverty Furniture and Jerónimo Martins
Assuming the 90 days horizon Haverty Furniture Companies is expected to under-perform the Jerónimo Martins. In addition to that, Haverty Furniture is 1.38 times more volatile than Jernimo Martins SGPS. It trades about 0.0 of its total potential returns per unit of risk. Jernimo Martins SGPS is currently generating about 0.0 per unit of volatility. If you would invest 1,927 in Jernimo Martins SGPS on September 3, 2024 and sell it today you would lose (93.00) from holding Jernimo Martins SGPS or give up 4.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haverty Furniture Companies vs. Jernimo Martins SGPS
Performance |
| Timeline |
| Haverty Furniture |
| Jernimo Martins SGPS |
Haverty Furniture and Jerónimo Martins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haverty Furniture and Jerónimo Martins
The main advantage of trading using opposite Haverty Furniture and Jerónimo Martins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haverty Furniture position performs unexpectedly, Jerónimo Martins 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 Jerónimo Martins will offset losses from the drop in Jerónimo Martins' long position.| Haverty Furniture vs. Lowes Companies | Haverty Furniture vs. Superior Plus Corp | Haverty Furniture vs. NMI Holdings | Haverty Furniture vs. Origin Agritech |
| Jerónimo Martins vs. Performance Food Group | Jerónimo Martins vs. Superior Plus Corp | Jerónimo Martins vs. NMI Holdings | Jerónimo Martins vs. Origin Agritech |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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