Correlation Between Hooker Furniture and FGI Industries
Can any of the company-specific risk be diversified away by investing in both Hooker Furniture and FGI Industries 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 FGI Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hooker Furniture and FGI Industries, you can compare the effects of market volatilities on Hooker Furniture and FGI Industries 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 FGI Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and FGI Industries.
Diversification Opportunities for Hooker Furniture and FGI Industries
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hooker and FGI is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and FGI Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FGI Industries 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 FGI Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FGI Industries has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and FGI Industries go up and down completely randomly.
Pair Corralation between Hooker Furniture and FGI Industries
Given the investment horizon of 90 days Hooker Furniture is expected to generate 0.47 times more return on investment than FGI Industries. However, Hooker Furniture is 2.14 times less risky than FGI Industries. It trades about 0.26 of its potential returns per unit of risk. FGI Industries is currently generating about -0.01 per unit of risk. If you would invest 1,605 in Hooker Furniture on August 28, 2024 and sell it today you would earn a total of 306.00 from holding Hooker Furniture or generate 19.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hooker Furniture vs. FGI Industries
Performance |
| Timeline |
| Hooker Furniture |
| FGI Industries |
Hooker Furniture and FGI Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hooker Furniture and FGI Industries
The main advantage of trading using opposite Hooker Furniture and FGI Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, FGI Industries 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 FGI Industries will offset losses from the drop in FGI Industries' long position.| Hooker Furniture vs. Willis Lease Finance | Hooker Furniture vs. Rocky Brands | Hooker Furniture vs. First Business Financial |
| FGI Industries vs. Fundamental Global | FGI Industries vs. Yoshitsu Co Ltd | FGI Industries vs. Hour Loop | FGI Industries vs. Direct Digital Holdings |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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