Correlation Between Burberry Group and Brunello Cucinelli
Can any of the company-specific risk be diversified away by investing in both Burberry Group and Brunello Cucinelli 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 Burberry Group and Brunello Cucinelli into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burberry Group Plc and Brunello Cucinelli SpA, you can compare the effects of market volatilities on Burberry Group and Brunello Cucinelli 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 Burberry Group with a short position of Brunello Cucinelli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burberry Group and Brunello Cucinelli.
Diversification Opportunities for Burberry Group and Brunello Cucinelli
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Burberry and Brunello is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Burberry Group Plc and Brunello Cucinelli SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunello Cucinelli SpA and Burberry Group 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 Burberry Group Plc are associated (or correlated) with Brunello Cucinelli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunello Cucinelli SpA has no effect on the direction of Burberry Group i.e., Burberry Group and Brunello Cucinelli go up and down completely randomly.
Pair Corralation between Burberry Group and Brunello Cucinelli
Assuming the 90 days horizon Burberry Group Plc is expected to under-perform the Brunello Cucinelli. In addition to that, Burberry Group is 1.49 times more volatile than Brunello Cucinelli SpA. It trades about -0.17 of its total potential returns per unit of risk. Brunello Cucinelli SpA is currently generating about 0.08 per unit of volatility. If you would invest 6,341 in Brunello Cucinelli SpA on November 27, 2024 and sell it today you would earn a total of 150.00 from holding Brunello Cucinelli SpA or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Burberry Group Plc vs. Brunello Cucinelli SpA
Performance |
| Timeline |
| Burberry Group Plc |
| Brunello Cucinelli SpA |
Burberry Group and Brunello Cucinelli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burberry Group and Brunello Cucinelli
The main advantage of trading using opposite Burberry Group and Brunello Cucinelli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burberry Group position performs unexpectedly, Brunello Cucinelli 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 Brunello Cucinelli will offset losses from the drop in Brunello Cucinelli's long position.| Burberry Group vs. Compagnie Financiere Richemont | Burberry Group vs. Hermes International SA | Burberry Group vs. Prada Spa PK | Burberry Group vs. Swatch Group AG |
| Brunello Cucinelli vs. LVMH Mot Hennessy | Brunello Cucinelli vs. Hermes International SA | Brunello Cucinelli vs. Hermes International SCA | Brunello Cucinelli vs. Christian Dior SE |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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