Correlation Between Hooker Furniture and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Hooker Furniture and Valneva SE 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 Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hooker Furniture and Valneva SE ADR, you can compare the effects of market volatilities on Hooker Furniture and Valneva SE 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 Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hooker Furniture and Valneva SE.
Diversification Opportunities for Hooker Furniture and Valneva SE
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hooker and Valneva is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Hooker Furniture and Valneva SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valneva SE ADR 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 Valneva SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valneva SE ADR has no effect on the direction of Hooker Furniture i.e., Hooker Furniture and Valneva SE go up and down completely randomly.
Pair Corralation between Hooker Furniture and Valneva SE
Given the investment horizon of 90 days Hooker Furniture is expected to under-perform the Valneva SE. But the stock apears to be less risky and, when comparing its historical volatility, Hooker Furniture is 2.25 times less risky than Valneva SE. The stock trades about -0.21 of its potential returns per unit of risk. The Valneva SE ADR is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 387.00 in Valneva SE ADR on December 2, 2024 and sell it today you would earn a total of 288.00 from holding Valneva SE ADR or generate 74.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hooker Furniture vs. Valneva SE ADR
Performance |
Timeline |
Hooker Furniture |
Valneva SE ADR |
Hooker Furniture and Valneva SE Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hooker Furniture and Valneva SE
The main advantage of trading using opposite Hooker Furniture and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hooker Furniture position performs unexpectedly, Valneva SE 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 Valneva SE will offset losses from the drop in Valneva SE's long position.Hooker Furniture vs. Bassett Furniture Industries | Hooker Furniture vs. Natuzzi SpA | Hooker Furniture vs. Flexsteel Industries | Hooker Furniture vs. Hamilton Beach Brands |
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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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