Correlation Between X FAB and Haverty Furniture
Can any of the company-specific risk be diversified away by investing in both X FAB 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 X FAB and Haverty Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Haverty Furniture Companies, you can compare the effects of market volatilities on X FAB 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 X FAB with a short position of Haverty Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of X FAB and Haverty Furniture.
Diversification Opportunities for X FAB and Haverty Furniture
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between XFB and Haverty is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Haverty Furniture Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haverty Furniture and X FAB 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 X FAB Silicon Foundries 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 X FAB i.e., X FAB and Haverty Furniture go up and down completely randomly.
Pair Corralation between X FAB and Haverty Furniture
Assuming the 90 days trading horizon X FAB Silicon Foundries is expected to under-perform the Haverty Furniture. In addition to that, X FAB is 1.54 times more volatile than Haverty Furniture Companies. It trades about -0.14 of its total potential returns per unit of risk. Haverty Furniture Companies is currently generating about 0.04 per unit of volatility. If you would invest 2,060 in Haverty Furniture Companies on November 9, 2024 and sell it today you would earn a total of 20.00 from holding Haverty Furniture Companies or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Haverty Furniture Companies
Performance |
| Timeline |
| X FAB Silicon |
| Haverty Furniture |
X FAB and Haverty Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X FAB and Haverty Furniture
The main advantage of trading using opposite X FAB and Haverty Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X FAB 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.| X FAB vs. Salesforce | X FAB vs. YATRA ONLINE DL 0001 | X FAB vs. Ares Management Corp | X FAB vs. MUTUIONLINE |
| Haverty Furniture vs. GOODYEAR T RUBBER | Haverty Furniture vs. Summit Materials | Haverty Furniture vs. Vulcan Materials | Haverty Furniture vs. Hua Hong Semiconductor |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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