Correlation Between Hooker Furniture and DIH Holding
Can any of the company-specific risk be diversified away by investing in both Hooker Furniture and DIH Holding 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 Hooker Furniture and DIH Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hooker Furniture and DIH Holding US,, you can compare the effects of market volatilities on Hooker Furniture and DIH Holding 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 Hooker Furniture with a short position of DIH Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and DIH Holding.
Diversification Opportunities for Hooker Furniture and DIH Holding
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hooker and DIH is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and DIH Holding US, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DIH Holding US, and Hooker 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 Hooker Furniture are associated (or correlated) with DIH Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DIH Holding US, has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and DIH Holding go up and down completely randomly.
Pair Corralation between Hooker Furniture and DIH Holding
Given the investment horizon of 90 days Hooker Furniture is expected to generate 6.95 times less return on investment than DIH Holding. But when comparing it to its historical volatility, Hooker Furniture is 6.65 times less risky than DIH Holding. It trades about 0.08 of its potential returns per unit of risk. DIH Holding US, is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 5.17 in DIH Holding US, on September 12, 2024 and sell it today you would lose (0.17) from holding DIH Holding US, or give up 3.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.2% |
| Values | Daily Returns |
Hooker Furniture vs. DIH Holding US,
Performance |
| Timeline |
| Hooker Furniture |
| DIH Holding US, |
Hooker Furniture and DIH Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hooker Furniture and DIH Holding
The main advantage of trading using opposite Hooker Furniture and DIH Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, DIH Holding 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 DIH Holding will offset losses from the drop in DIH Holding's long position.| Hooker Furniture vs. Bassett Furniture Industries | Hooker Furniture vs. Natuzzi SpA | Hooker Furniture vs. Flexsteel Industries | Hooker Furniture vs. Hamilton Beach Brands |
| DIH Holding vs. Harmony Gold Mining | DIH Holding vs. Getty Copper | DIH Holding vs. Hooker Furniture | DIH Holding vs. Eastman Kodak Co |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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