Correlation Between Haverty Furniture and Designer Brands
Can any of the company-specific risk be diversified away by investing in both Haverty Furniture and Designer Brands 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 Designer Brands 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 Designer Brands, you can compare the effects of market volatilities on Haverty Furniture and Designer Brands 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 Designer Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haverty Furniture and Designer Brands.
Diversification Opportunities for Haverty Furniture and Designer Brands
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Haverty and Designer is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Haverty Furniture Companies and Designer Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Designer Brands 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 Designer Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Designer Brands has no effect on the direction of Haverty Furniture i.e., Haverty Furniture and Designer Brands go up and down completely randomly.
Pair Corralation between Haverty Furniture and Designer Brands
Considering the 90-day investment horizon Haverty Furniture Companies is expected to generate 0.95 times more return on investment than Designer Brands. However, Haverty Furniture Companies is 1.06 times less risky than Designer Brands. It trades about -0.11 of its potential returns per unit of risk. Designer Brands is currently generating about -0.32 per unit of risk. If you would invest 2,474 in Haverty Furniture Companies on August 23, 2024 and sell it today you would lose (161.00) from holding Haverty Furniture Companies or give up 6.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haverty Furniture Companies vs. Designer Brands
Performance |
| Timeline |
| Haverty Furniture |
| Designer Brands |
Haverty Furniture and Designer Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haverty Furniture and Designer Brands
The main advantage of trading using opposite Haverty Furniture and Designer Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haverty Furniture position performs unexpectedly, Designer Brands 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 Designer Brands will offset losses from the drop in Designer Brands' long position.| Haverty Furniture vs. Small Cap Core | Haverty Furniture vs. Freedom Holding Corp | Haverty Furniture vs. Gfl Environmental Holdings | Haverty Furniture vs. Growth Fund Of |
| Designer Brands vs. Wolverine World Wide | Designer Brands vs. Weyco Group | Designer Brands vs. Steven Madden | Designer Brands vs. Rocky Brands |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |