Correlation Between Hooker Furniture and Pingtan Marine
Can any of the company-specific risk be diversified away by investing in both Hooker Furniture and Pingtan Marine 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 Pingtan Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hooker Furniture and Pingtan Marine Enterprise, you can compare the effects of market volatilities on Hooker Furniture and Pingtan Marine 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 Pingtan Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and Pingtan Marine.
Diversification Opportunities for Hooker Furniture and Pingtan Marine
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hooker and Pingtan is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and Pingtan Marine Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pingtan Marine Enterprise 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 Pingtan Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pingtan Marine Enterprise has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and Pingtan Marine go up and down completely randomly.
Pair Corralation between Hooker Furniture and Pingtan Marine
Given the investment horizon of 90 days Hooker Furniture is expected to generate 0.24 times more return on investment than Pingtan Marine. However, Hooker Furniture is 4.08 times less risky than Pingtan Marine. It trades about 0.03 of its potential returns per unit of risk. Pingtan Marine Enterprise is currently generating about -0.08 per unit of risk. If you would invest 1,559 in Hooker Furniture on September 2, 2024 and sell it today you would earn a total of 314.00 from holding Hooker Furniture or generate 20.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 12.5% |
| Values | Daily Returns |
Hooker Furniture vs. Pingtan Marine Enterprise
Performance |
| Timeline |
| Hooker Furniture |
| Pingtan Marine Enterprise |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hooker Furniture and Pingtan Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hooker Furniture and Pingtan Marine
The main advantage of trading using opposite Hooker Furniture and Pingtan Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, Pingtan Marine 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 Pingtan Marine will offset losses from the drop in Pingtan Marine's long position.| Hooker Furniture vs. Willis Lease Finance | Hooker Furniture vs. Rocky Brands | Hooker Furniture vs. First Business Financial |
| Pingtan Marine vs. Hudson Pacific Properties | Pingtan Marine vs. RBC Bearings Incorporated | Pingtan Marine vs. RCS MediaGroup SpA | Pingtan Marine vs. Bausch Lomb Corp |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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