Correlation Between Hooker Furniture and Kulicke
Can any of the company-specific risk be diversified away by investing in both Hooker Furniture and Kulicke 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 Kulicke into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hooker Furniture and Kulicke and Soffa, you can compare the effects of market volatilities on Hooker Furniture and Kulicke 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 Kulicke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and Kulicke.
Diversification Opportunities for Hooker Furniture and Kulicke
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hooker and Kulicke is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and Kulicke and Soffa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kulicke and Soffa 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 Kulicke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kulicke and Soffa has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and Kulicke go up and down completely randomly.
Pair Corralation between Hooker Furniture and Kulicke
Given the investment horizon of 90 days Hooker Furniture is expected to under-perform the Kulicke. In addition to that, Hooker Furniture is 1.18 times more volatile than Kulicke and Soffa. It trades about -0.02 of its total potential returns per unit of risk. Kulicke and Soffa is currently generating about 0.01 per unit of volatility. If you would invest 5,218 in Kulicke and Soffa on September 4, 2024 and sell it today you would lose (182.00) from holding Kulicke and Soffa or give up 3.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hooker Furniture vs. Kulicke and Soffa
Performance |
| Timeline |
| Hooker Furniture |
| Kulicke and Soffa |
Hooker Furniture and Kulicke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hooker Furniture and Kulicke
The main advantage of trading using opposite Hooker Furniture and Kulicke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, Kulicke 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 Kulicke will offset losses from the drop in Kulicke'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 |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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