Correlation Between Hooker Furniture and NOVARTIS
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By analyzing existing cross correlation between Hooker Furniture and NOVARTIS CAP P, you can compare the effects of market volatilities on Hooker Furniture and NOVARTIS 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 NOVARTIS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and NOVARTIS.
Diversification Opportunities for Hooker Furniture and NOVARTIS
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hooker and NOVARTIS is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and NOVARTIS CAP P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NOVARTIS CAP P 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 NOVARTIS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NOVARTIS CAP P has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and NOVARTIS go up and down completely randomly.
Pair Corralation between Hooker Furniture and NOVARTIS
Given the investment horizon of 90 days Hooker Furniture is expected to under-perform the NOVARTIS. In addition to that, Hooker Furniture is 4.25 times more volatile than NOVARTIS CAP P. It trades about -0.01 of its total potential returns per unit of risk. NOVARTIS CAP P is currently generating about 0.23 per unit of volatility. If you would invest 9,001 in NOVARTIS CAP P on September 13, 2024 and sell it today you would earn a total of 286.00 from holding NOVARTIS CAP P or generate 3.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
Hooker Furniture vs. NOVARTIS CAP P
Performance |
| Timeline |
| Hooker Furniture |
| NOVARTIS CAP P |
Hooker Furniture and NOVARTIS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hooker Furniture and NOVARTIS
The main advantage of trading using opposite Hooker Furniture and NOVARTIS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, NOVARTIS 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 NOVARTIS will offset losses from the drop in NOVARTIS's long position.| Hooker Furniture vs. Natuzzi SpA | Hooker Furniture vs. Flexsteel Industries | Hooker Furniture vs. Hamilton Beach Brands | Hooker Furniture vs. La Z Boy Incorporated |
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