Correlation Between Haverty Furniture and PICC Property
Can any of the company-specific risk be diversified away by investing in both Haverty Furniture and PICC Property 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 PICC Property 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 PICC Property and, you can compare the effects of market volatilities on Haverty Furniture and PICC Property 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 PICC Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haverty Furniture and PICC Property.
Diversification Opportunities for Haverty Furniture and PICC Property
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haverty and PICC is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Haverty Furniture Companies and PICC Property and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PICC Property 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 PICC Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PICC Property has no effect on the direction of Haverty Furniture i.e., Haverty Furniture and PICC Property go up and down completely randomly.
Pair Corralation between Haverty Furniture and PICC Property
Assuming the 90 days horizon Haverty Furniture Companies is expected to under-perform the PICC Property. But the stock apears to be less risky and, when comparing its historical volatility, Haverty Furniture Companies is 2.34 times less risky than PICC Property. The stock trades about -0.01 of its potential returns per unit of risk. The PICC Property and is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 19.00 in PICC Property and on December 4, 2024 and sell it today you would earn a total of 134.00 from holding PICC Property and or generate 705.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Haverty Furniture Companies vs. PICC Property and
Performance |
Timeline |
Haverty Furniture |
PICC Property |
Haverty Furniture and PICC Property Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Haverty Furniture and PICC Property
The main advantage of trading using opposite Haverty Furniture and PICC Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haverty Furniture position performs unexpectedly, PICC Property 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 PICC Property will offset losses from the drop in PICC Property's long position.Haverty Furniture vs. HK Electric Investments | Haverty Furniture vs. Inspire Medical Systems | Haverty Furniture vs. New Residential Investment | Haverty Furniture vs. PennyMac Mortgage Investment |
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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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