Correlation Between Haverty Furniture and Citi Trends
Can any of the company-specific risk be diversified away by investing in both Haverty Furniture and Citi Trends 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 Haverty Furniture and Citi Trends into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haverty Furniture Companies and Citi Trends, you can compare the effects of market volatilities on Haverty Furniture and Citi Trends 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 Haverty Furniture with a short position of Citi Trends. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haverty Furniture and Citi Trends.
Diversification Opportunities for Haverty Furniture and Citi Trends
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haverty and Citi is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Haverty Furniture Companies and Citi Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citi Trends and Haverty 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 Haverty Furniture Companies are associated (or correlated) with Citi Trends. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citi Trends has no effect on the direction of Haverty Furniture i.e., Haverty Furniture and Citi Trends go up and down completely randomly.
Pair Corralation between Haverty Furniture and Citi Trends
Considering the 90-day investment horizon Haverty Furniture Companies is expected to generate 0.76 times more return on investment than Citi Trends. However, Haverty Furniture Companies is 1.32 times less risky than Citi Trends. It trades about 0.0 of its potential returns per unit of risk. Citi Trends is currently generating about -0.01 per unit of risk. If you would invest 2,852 in Haverty Furniture Companies on August 28, 2024 and sell it today you would lose (391.00) from holding Haverty Furniture Companies or give up 13.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haverty Furniture Companies vs. Citi Trends
Performance |
| Timeline |
| Haverty Furniture |
| Citi Trends |
Haverty Furniture and Citi Trends Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haverty Furniture and Citi Trends
The main advantage of trading using opposite Haverty Furniture and Citi Trends positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haverty Furniture position performs unexpectedly, Citi Trends 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 Citi Trends will offset losses from the drop in Citi Trends' long position.| Haverty Furniture vs. AutoZone | Haverty Furniture vs. Ulta Beauty | Haverty Furniture vs. Best Buy Co | Haverty Furniture vs. Dicks Sporting Goods |
| Citi Trends vs. JJill Inc | Citi Trends vs. Zumiez Inc | Citi Trends vs. Tillys Inc | Citi Trends vs. Duluth 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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