Correlation Between Nextplat Corp and Bassett Furniture
Can any of the company-specific risk be diversified away by investing in both Nextplat Corp and Bassett Furniture 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 Nextplat Corp and Bassett Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextplat Corp and Bassett Furniture Industries, you can compare the effects of market volatilities on Nextplat Corp and Bassett Furniture 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 Nextplat Corp with a short position of Bassett Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextplat Corp and Bassett Furniture.
Diversification Opportunities for Nextplat Corp and Bassett Furniture
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nextplat and Bassett is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Nextplat Corp and Bassett Furniture Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bassett Furniture and Nextplat Corp 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 Nextplat Corp are associated (or correlated) with Bassett Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bassett Furniture has no effect on the direction of Nextplat Corp i.e., Nextplat Corp and Bassett Furniture go up and down completely randomly.
Pair Corralation between Nextplat Corp and Bassett Furniture
Given the investment horizon of 90 days Nextplat Corp is expected to generate 2.63 times more return on investment than Bassett Furniture. However, Nextplat Corp is 2.63 times more volatile than Bassett Furniture Industries. It trades about 0.0 of its potential returns per unit of risk. Bassett Furniture Industries is currently generating about 0.0 per unit of risk. If you would invest 161.00 in Nextplat Corp on August 31, 2024 and sell it today you would lose (76.00) from holding Nextplat Corp or give up 47.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nextplat Corp vs. Bassett Furniture Industries
Performance |
| Timeline |
| Nextplat Corp |
| Bassett Furniture |
Nextplat Corp and Bassett Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nextplat Corp and Bassett Furniture
The main advantage of trading using opposite Nextplat Corp and Bassett Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextplat Corp position performs unexpectedly, Bassett Furniture 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 Bassett Furniture will offset losses from the drop in Bassett Furniture's long position.| Nextplat Corp vs. RenoWorks Software | Nextplat Corp vs. LifeSpeak | Nextplat Corp vs. 01 Communique Laboratory | Nextplat Corp vs. Where Food Comes |
| Bassett Furniture vs. Hooker Furniture | Bassett Furniture vs. Flexsteel Industries | Bassett Furniture vs. Haverty Furniture Companies | Bassett Furniture vs. La Z Boy Incorporated |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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