Correlation Between Allient and HNI Corp
Can any of the company-specific risk be diversified away by investing in both Allient and HNI Corp 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 Allient and HNI Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allient and HNI Corp, you can compare the effects of market volatilities on Allient and HNI Corp 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 Allient with a short position of HNI Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allient and HNI Corp.
Diversification Opportunities for Allient and HNI Corp
Poor diversification
The 3 months correlation between Allient and HNI is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Allient and HNI Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HNI Corp and Allient 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 Allient are associated (or correlated) with HNI Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HNI Corp has no effect on the direction of Allient i.e., Allient and HNI Corp go up and down completely randomly.
Pair Corralation between Allient and HNI Corp
Given the investment horizon of 90 days Allient is expected to under-perform the HNI Corp. In addition to that, Allient is 1.54 times more volatile than HNI Corp. It trades about -0.01 of its total potential returns per unit of risk. HNI Corp is currently generating about 0.09 per unit of volatility. If you would invest 2,670 in HNI Corp on September 2, 2024 and sell it today you would earn a total of 2,995 from holding HNI Corp or generate 112.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allient vs. HNI Corp
Performance |
| Timeline |
| Allient |
| HNI Corp |
Allient and HNI Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allient and HNI Corp
The main advantage of trading using opposite Allient and HNI Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allient position performs unexpectedly, HNI Corp 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 HNI Corp will offset losses from the drop in HNI Corp's long position.| Allient vs. Shenzhen Genvict Technologies | Allient vs. Topsec Technologies Group | Allient vs. Genus Power Infrastructures | Allient vs. Risuntek |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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