Correlation Between Capri Holdings and Hangzhou Weiguang
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By analyzing existing cross correlation between Capri Holdings and Hangzhou Weiguang Electronic, you can compare the effects of market volatilities on Capri Holdings and Hangzhou Weiguang 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 Capri Holdings with a short position of Hangzhou Weiguang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and Hangzhou Weiguang.
Diversification Opportunities for Capri Holdings and Hangzhou Weiguang
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Capri and Hangzhou is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Hangzhou Weiguang Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Weiguang and Capri 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 Capri Holdings are associated (or correlated) with Hangzhou Weiguang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Weiguang has no effect on the direction of Capri Holdings i.e., Capri Holdings and Hangzhou Weiguang go up and down completely randomly.
Pair Corralation between Capri Holdings and Hangzhou Weiguang
Given the investment horizon of 90 days Capri Holdings is expected to generate 1.25 times more return on investment than Hangzhou Weiguang. However, Capri Holdings is 1.25 times more volatile than Hangzhou Weiguang Electronic. It trades about 0.26 of its potential returns per unit of risk. Hangzhou Weiguang Electronic is currently generating about 0.22 per unit of risk. If you would invest 1,974 in Capri Holdings on September 1, 2024 and sell it today you would earn a total of 367.00 from holding Capri Holdings or generate 18.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Capri Holdings vs. Hangzhou Weiguang Electronic
Performance |
| Timeline |
| Capri Holdings |
| Hangzhou Weiguang |
Capri Holdings and Hangzhou Weiguang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and Hangzhou Weiguang
The main advantage of trading using opposite Capri Holdings and Hangzhou Weiguang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, Hangzhou Weiguang 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 Hangzhou Weiguang will offset losses from the drop in Hangzhou Weiguang's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| Hangzhou Weiguang vs. China Life Insurance | Hangzhou Weiguang vs. Cinda Securities Co | Hangzhou Weiguang vs. Piotech Inc A | Hangzhou Weiguang vs. Dongxing Sec Co |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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