Correlation Between Haverty Furniture and MULTI CHEM

Can any of the company-specific risk be diversified away by investing in both Haverty Furniture and MULTI CHEM 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 MULTI CHEM 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 MULTI CHEM LTD, you can compare the effects of market volatilities on Haverty Furniture and MULTI CHEM 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 MULTI CHEM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haverty Furniture and MULTI CHEM.

Diversification Opportunities for Haverty Furniture and MULTI CHEM

0.51

Correlation Coefficient

Haverty Furniture  MULTI CHEM

Very weak diversification

The 3 months correlation between Haverty and MULTI is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Haverty Furniture Companies and MULTI CHEM LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MULTI CHEM LTD 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 MULTI CHEM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MULTI CHEM LTD has no effect on the direction of Haverty Furniture i.e., Haverty Furniture and MULTI CHEM go up and down completely randomly.

Pair Corralation between Haverty Furniture and MULTI CHEM

Assuming the 90 days horizon Haverty Furniture is expected to generate 1.2 times less return on investment than MULTI CHEM. But when comparing it to its historical volatility, Haverty Furniture Companies is 1.57 times less risky than MULTI CHEM. It trades about 0.08 of its potential returns per unit of risk. MULTI CHEM LTD is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  189.00  in MULTI CHEM LTD on April 24, 2025 and sell it today you would earn a total of  25.00  from holding MULTI CHEM LTD or generate 13.23% return on investment over 90 days.

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

Haverty Furniture Companies  vs.  MULTI CHEM LTD

Haverty Furniture

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Haverty Furniture Companies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Haverty Furniture reported solid returns over the last few months and may actually be approaching a breakup point.

MULTI CHEM LTD

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MULTI CHEM LTD are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, MULTI CHEM reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Haverty Furniture and MULTI CHEM

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

The idea behind Haverty Furniture Companies and MULTI CHEM LTD 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..