Correlation Between Bassett Furniture and PhenomeX
Can any of the company-specific risk be diversified away by investing in both Bassett Furniture and PhenomeX 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 Bassett Furniture and PhenomeX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bassett Furniture Industries and PhenomeX, you can compare the effects of market volatilities on Bassett Furniture and PhenomeX 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 Bassett Furniture with a short position of PhenomeX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bassett Furniture and PhenomeX.
Diversification Opportunities for Bassett Furniture and PhenomeX
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bassett and PhenomeX is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Bassett Furniture Industries and PhenomeX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PhenomeX and Bassett 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 Bassett Furniture Industries are associated (or correlated) with PhenomeX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PhenomeX has no effect on the direction of Bassett Furniture i.e., Bassett Furniture and PhenomeX go up and down completely randomly.
Pair Corralation between Bassett Furniture and PhenomeX
If you would invest 1,480 in Bassett Furniture Industries on September 5, 2024 and sell it today you would earn a total of 50.00 from holding Bassett Furniture Industries or generate 3.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Bassett Furniture Industries vs. PhenomeX
Performance |
| Timeline |
| Bassett Furniture |
| PhenomeX |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bassett Furniture and PhenomeX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bassett Furniture and PhenomeX
The main advantage of trading using opposite Bassett Furniture and PhenomeX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bassett Furniture position performs unexpectedly, PhenomeX 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 PhenomeX will offset losses from the drop in PhenomeX's long position.| Bassett Furniture vs. Flexsteel Industries | Bassett Furniture vs. Crown Crafts | Bassett Furniture vs. MasterBrand | Bassett Furniture vs. MillerKnoll |
| PhenomeX vs. Bassett Furniture Industries | PhenomeX vs. Hudson Pacific Properties | PhenomeX vs. Smith Douglas Homes | PhenomeX vs. Mid Atlantic Home Health |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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