Correlation Between Hooker Furniture and LOBO EV

Can any of the company-specific risk be diversified away by investing in both Hooker Furniture and LOBO EV 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 Hooker Furniture and LOBO EV into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hooker Furniture and LOBO EV TECHNOLOGIES, you can compare the effects of market volatilities on Hooker Furniture and LOBO EV 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 Hooker Furniture with a short position of LOBO EV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and LOBO EV.

Diversification Opportunities for Hooker Furniture and LOBO EV

0.62

Correlation Coefficient

Hooker Furniture  LOBO EV

Poor diversification

The 3 months correlation between Hooker and LOBO is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and LOBO EV TECHNOLOGIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOBO EV TECHNOLOGIES and Hooker 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 Hooker Furniture are associated (or correlated) with LOBO EV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOBO EV TECHNOLOGIES has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and LOBO EV go up and down completely randomly.

Pair Corralation between Hooker Furniture and LOBO EV

Given the investment horizon of 90 days Hooker Furniture is expected to generate 0.58 times more return on investment than LOBO EV. However, Hooker Furniture is 1.71 times less risky than LOBO EV. It trades about -0.06 of its potential returns per unit of risk. LOBO EV TECHNOLOGIES is currently generating about -0.13 per unit of risk. If you would invest  1,562  in Hooker Furniture on October 25, 2024 and sell it today you would lose (205.00) from holding Hooker Furniture or give up 13.12% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Hooker Furniture  vs.  LOBO EV TECHNOLOGIES

Hooker Furniture

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hooker Furniture has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

LOBO EV TECHNOLOGIES

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LOBO EV TECHNOLOGIES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental drivers remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Hooker Furniture and LOBO EV

The main advantage of trading using opposite Hooker Furniture and LOBO EV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, LOBO EV 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 LOBO EV will offset losses from the drop in LOBO EV's long position.

The idea behind Hooker Furniture and LOBO EV TECHNOLOGIES pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.