Correlation Between HG Holdings and Hooker Furniture

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

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

Diversification Opportunities for HG Holdings and Hooker Furniture

0.0

Correlation Coefficient

HG Holdings  Hooker Furniture

Pay attention - limited upside

The 3 months correlation between STLY and Hooker is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding HG Holdings and Hooker Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hooker Furniture and HG Holdings 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 HG Holdings are associated (or correlated) with Hooker Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hooker Furniture has no effect on the direction of HG Holdings i.e., HG Holdings and Hooker Furniture go up and down completely randomly.

Pair Corralation between HG Holdings and Hooker Furniture

If you would invest (100.00) in HG Holdings on December 26, 2024 and sell it today you would earn a total of  100.00  from holding HG Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

HG Holdings  vs.  Hooker Furniture

HG Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days HG Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, HG Holdings is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Hooker Furniture

Risk-Adjusted Performance

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 weak performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with HG Holdings and Hooker Furniture

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

The idea behind HG Holdings and Hooker Furniture 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.