Correlation Between Sun Country and Haverty Furniture
Can any of the company-specific risk be diversified away by investing in both Sun Country 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 Sun Country and Haverty Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Country Airlines and Haverty Furniture Companies, you can compare the effects of market volatilities on Sun Country 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 Sun Country with a short position of Haverty Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and Haverty Furniture.
Diversification Opportunities for Sun Country and Haverty Furniture
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sun and Haverty is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and Haverty Furniture Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haverty Furniture and Sun Country 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 Sun Country Airlines 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 Sun Country i.e., Sun Country and Haverty Furniture go up and down completely randomly.
Pair Corralation between Sun Country and Haverty Furniture
Given the investment horizon of 90 days Sun Country Airlines is expected to generate 1.37 times more return on investment than Haverty Furniture. However, Sun Country is 1.37 times more volatile than Haverty Furniture Companies. It trades about -0.01 of its potential returns per unit of risk. Haverty Furniture Companies is currently generating about -0.03 per unit of risk. If you would invest 1,710 in Sun Country Airlines on September 3, 2024 and sell it today you would lose (316.00) from holding Sun Country Airlines or give up 18.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Country Airlines vs. Haverty Furniture Companies
Performance |
| Timeline |
| Sun Country Airlines |
| Haverty Furniture |
Sun Country and Haverty Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and Haverty Furniture
The main advantage of trading using opposite Sun Country and Haverty Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country 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.| Sun Country vs. Copa Holdings SA | Sun Country vs. SkyWest | Sun Country vs. Air Transport Services | Sun Country vs. Mesa Air Group |
| Haverty Furniture vs. Partner Communications | Haverty Furniture vs. Merck Company | Haverty Furniture vs. Western Midstream Partners | Haverty Furniture vs. Edgewise Therapeutics |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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