Correlation Between Byggmax Group and Haverty Furniture
Can any of the company-specific risk be diversified away by investing in both Byggmax Group and Haverty Furniture 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 Byggmax Group and Haverty Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Byggmax Group AB and Haverty Furniture Companies, you can compare the effects of market volatilities on Byggmax Group and Haverty Furniture 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 Byggmax Group with a short position of Haverty Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Byggmax Group and Haverty Furniture.
Diversification Opportunities for Byggmax Group and Haverty Furniture
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Byggmax and Haverty is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Byggmax Group AB and Haverty Furniture Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haverty Furniture and Byggmax Group 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 Byggmax Group AB are associated (or correlated) with Haverty Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haverty Furniture has no effect on the direction of Byggmax Group i.e., Byggmax Group and Haverty Furniture go up and down completely randomly.
Pair Corralation between Byggmax Group and Haverty Furniture
Assuming the 90 days horizon Byggmax Group AB is expected to generate 1.93 times more return on investment than Haverty Furniture. However, Byggmax Group is 1.93 times more volatile than Haverty Furniture Companies. It trades about 0.12 of its potential returns per unit of risk. Haverty Furniture Companies is currently generating about 0.15 per unit of risk. If you would invest 386.00 in Byggmax Group AB on November 2, 2024 and sell it today you would earn a total of 22.00 from holding Byggmax Group AB or generate 5.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Byggmax Group AB vs. Haverty Furniture Companies
Performance |
| Timeline |
| Byggmax Group AB |
| Haverty Furniture |
Byggmax Group and Haverty Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Byggmax Group and Haverty Furniture
The main advantage of trading using opposite Byggmax Group and Haverty Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Byggmax Group position performs unexpectedly, Haverty Furniture 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 Haverty Furniture will offset losses from the drop in Haverty Furniture's long position.| Byggmax Group vs. Lowes Companies | Byggmax Group vs. Wesfarmers Limited | Byggmax Group vs. Kingfisher plc | Byggmax Group vs. Fiskars Oyj Abp |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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