Correlation Between HNI and Granite Construction
Can any of the company-specific risk be diversified away by investing in both HNI and Granite Construction 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 HNI and Granite Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HNI Corporation and Granite Construction, you can compare the effects of market volatilities on HNI and Granite Construction 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 with a short position of Granite Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of HNI and Granite Construction.
Diversification Opportunities for HNI and Granite Construction
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HNI and Granite is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding HNI Corp. and Granite Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite Construction and HNI 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 Corporation are associated (or correlated) with Granite Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite Construction has no effect on the direction of HNI i.e., HNI and Granite Construction go up and down completely randomly.
Pair Corralation between HNI and Granite Construction
Assuming the 90 days horizon HNI Corporation is expected to under-perform the Granite Construction. In addition to that, HNI is 1.34 times more volatile than Granite Construction. It trades about -0.12 of its total potential returns per unit of risk. Granite Construction is currently generating about -0.13 per unit of volatility. If you would invest 8,150 in Granite Construction on November 29, 2024 and sell it today you would lose (350.00) from holding Granite Construction or give up 4.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
HNI Corp. vs. Granite Construction
Performance |
| Timeline |
| HNI Corporation |
| Granite Construction |
HNI and Granite Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HNI and Granite Construction
The main advantage of trading using opposite HNI and Granite Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HNI position performs unexpectedly, Granite Construction 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 Granite Construction will offset losses from the drop in Granite Construction's long position.| HNI vs. New Residential Investment | HNI vs. Gladstone Investment | HNI vs. Investment AB Latour | HNI vs. REINET INVESTMENTS SCA |
| Granite Construction vs. Broadridge Financial Solutions | Granite Construction vs. Liberty Broadband | Granite Construction vs. BROADPEAK SA EO | Granite Construction vs. Suntory Beverage Food |
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.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |