Correlation Between SERI INDUSTRIAL and Haverty Furniture
Can any of the company-specific risk be diversified away by investing in both SERI INDUSTRIAL and Haverty 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 SERI INDUSTRIAL and Haverty Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SERI INDUSTRIAL EO and Haverty Furniture Companies, you can compare the effects of market volatilities on SERI INDUSTRIAL and Haverty 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 SERI INDUSTRIAL with a short position of Haverty Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of SERI INDUSTRIAL and Haverty Furniture.
Diversification Opportunities for SERI INDUSTRIAL and Haverty Furniture
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between SERI and Haverty is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding SERI INDUSTRIAL EO and Haverty Furniture Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haverty Furniture and SERI INDUSTRIAL 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 SERI INDUSTRIAL EO are associated (or correlated) with Haverty Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haverty Furniture has no effect on the direction of SERI INDUSTRIAL i.e., SERI INDUSTRIAL and Haverty Furniture go up and down completely randomly.
Pair Corralation between SERI INDUSTRIAL and Haverty Furniture
Assuming the 90 days trading horizon SERI INDUSTRIAL EO is expected to under-perform the Haverty Furniture. In addition to that, SERI INDUSTRIAL is 2.01 times more volatile than Haverty Furniture Companies. It trades about -0.2 of its total potential returns per unit of risk. Haverty Furniture Companies is currently generating about 0.09 per unit of volatility. If you would invest 2,100 in Haverty Furniture Companies on November 4, 2024 and sell it today you would earn a total of 60.00 from holding Haverty Furniture Companies or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SERI INDUSTRIAL EO vs. Haverty Furniture Companies
Performance |
| Timeline |
| SERI INDUSTRIAL EO |
| Haverty Furniture |
SERI INDUSTRIAL and Haverty Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SERI INDUSTRIAL and Haverty Furniture
The main advantage of trading using opposite SERI INDUSTRIAL and Haverty Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SERI INDUSTRIAL position performs unexpectedly, Haverty 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 Haverty Furniture will offset losses from the drop in Haverty Furniture's long position.| SERI INDUSTRIAL vs. JAPAN AIRLINES | SERI INDUSTRIAL vs. Major Drilling Group | SERI INDUSTRIAL vs. AWILCO DRILLING PLC | SERI INDUSTRIAL vs. China Eastern Airlines |
| Haverty Furniture vs. Lowes Companies | Haverty Furniture vs. Wesfarmers Limited | Haverty Furniture vs. Kingfisher plc | Haverty Furniture vs. Fiskars Oyj Abp |
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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