Correlation Between HNI Corp and NISOURCE
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By analyzing existing cross correlation between HNI Corp and NISOURCE FIN P, you can compare the effects of market volatilities on HNI Corp and NISOURCE 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 HNI Corp with a short position of NISOURCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of HNI Corp and NISOURCE.
Diversification Opportunities for HNI Corp and NISOURCE
Very good diversification
The 3 months correlation between HNI and NISOURCE is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding HNI Corp and NISOURCE FIN P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NISOURCE FIN P and HNI Corp 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 HNI Corp are associated (or correlated) with NISOURCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NISOURCE FIN P has no effect on the direction of HNI Corp i.e., HNI Corp and NISOURCE go up and down completely randomly.
Pair Corralation between HNI Corp and NISOURCE
Considering the 90-day investment horizon HNI Corp is expected to generate 0.98 times more return on investment than NISOURCE. However, HNI Corp is 1.03 times less risky than NISOURCE. It trades about 0.32 of its potential returns per unit of risk. NISOURCE FIN P is currently generating about -0.08 per unit of risk. If you would invest 5,077 in HNI Corp on September 5, 2024 and sell it today you would earn a total of 603.00 from holding HNI Corp or generate 11.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 77.27% |
Values | Daily Returns |
HNI Corp vs. NISOURCE FIN P
Performance |
Timeline |
HNI Corp |
NISOURCE FIN P |
HNI Corp and NISOURCE Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HNI Corp and NISOURCE
The main advantage of trading using opposite HNI Corp and NISOURCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HNI Corp position performs unexpectedly, NISOURCE 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 NISOURCE will offset losses from the drop in NISOURCE's long position.The idea behind HNI Corp and NISOURCE FIN P pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.NISOURCE vs. AEP TEX INC | NISOURCE vs. US BANK NATIONAL | NISOURCE vs. MetLife | NISOURCE vs. Jackson Financial |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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