Correlation Between Falcons Beyond and Hooker Furniture
Can any of the company-specific risk be diversified away by investing in both Falcons Beyond and Hooker 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 Falcons Beyond and Hooker Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Falcons Beyond Global, and Hooker Furniture, you can compare the effects of market volatilities on Falcons Beyond and Hooker 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 Falcons Beyond with a short position of Hooker Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Falcons Beyond and Hooker Furniture.
Diversification Opportunities for Falcons Beyond and Hooker Furniture
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Falcons and Hooker is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Falcons Beyond Global, and Hooker Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hooker Furniture and Falcons Beyond 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 Falcons Beyond Global, are associated (or correlated) with Hooker Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hooker Furniture has no effect on the direction of Falcons Beyond i.e., Falcons Beyond and Hooker Furniture go up and down completely randomly.
Pair Corralation between Falcons Beyond and Hooker Furniture
Assuming the 90 days horizon Falcons Beyond Global, is expected to generate 5.28 times more return on investment than Hooker Furniture. However, Falcons Beyond is 5.28 times more volatile than Hooker Furniture. It trades about 0.07 of its potential returns per unit of risk. Hooker Furniture is currently generating about 0.12 per unit of risk. If you would invest 109.00 in Falcons Beyond Global, on August 28, 2024 and sell it today you would lose (9.00) from holding Falcons Beyond Global, or give up 8.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 80.95% |
| Values | Daily Returns |
Falcons Beyond Global, vs. Hooker Furniture
Performance |
| Timeline |
| Falcons Beyond Global, |
| Hooker Furniture |
Falcons Beyond and Hooker Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Falcons Beyond and Hooker Furniture
The main advantage of trading using opposite Falcons Beyond and Hooker Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Falcons Beyond position performs unexpectedly, Hooker 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 Hooker Furniture will offset losses from the drop in Hooker Furniture's long position.| Falcons Beyond vs. Lindblad Expeditions Holdings | Falcons Beyond vs. Hooker Furniture | Falcons Beyond vs. Western Acquisition Ventures | Falcons Beyond vs. Getty Copper |
| Hooker Furniture vs. Bassett Furniture Industries | Hooker Furniture vs. Natuzzi SpA | Hooker Furniture vs. Flexsteel Industries | Hooker Furniture vs. Hamilton Beach Brands |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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