Correlation Between Bassett Furniture and CXApp
Can any of the company-specific risk be diversified away by investing in both Bassett Furniture and CXApp 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 CXApp 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 CXApp Inc, you can compare the effects of market volatilities on Bassett Furniture and CXApp 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 CXApp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bassett Furniture and CXApp.
Diversification Opportunities for Bassett Furniture and CXApp
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bassett and CXApp is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bassett Furniture Industries and CXApp Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CXApp Inc 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 CXApp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CXApp Inc has no effect on the direction of Bassett Furniture i.e., Bassett Furniture and CXApp go up and down completely randomly.
Pair Corralation between Bassett Furniture and CXApp
Given the investment horizon of 90 days Bassett Furniture Industries is expected to generate 0.41 times more return on investment than CXApp. However, Bassett Furniture Industries is 2.45 times less risky than CXApp. It trades about 0.03 of its potential returns per unit of risk. CXApp Inc is currently generating about -0.41 per unit of risk. If you would invest 1,385 in Bassett Furniture Industries on October 29, 2024 and sell it today you would earn a total of 10.00 from holding Bassett Furniture Industries or generate 0.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bassett Furniture Industries vs. CXApp Inc
Performance |
| Timeline |
| Bassett Furniture |
| CXApp Inc |
Bassett Furniture and CXApp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bassett Furniture and CXApp
The main advantage of trading using opposite Bassett Furniture and CXApp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bassett Furniture position performs unexpectedly, CXApp 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 CXApp will offset losses from the drop in CXApp's long position.| Bassett Furniture vs. Hooker Furniture | Bassett Furniture vs. Flexsteel Industries | Bassett Furniture vs. Haverty Furniture Companies | Bassett Furniture vs. La Z Boy Incorporated |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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