Correlation Between Capri Holdings and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and BNP Paribas 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 Capri Holdings and BNP Paribas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and BNP Paribas Easy, you can compare the effects of market volatilities on Capri Holdings and BNP Paribas 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 BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and BNP Paribas.
Diversification Opportunities for Capri Holdings and BNP Paribas
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Capri and BNP is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and BNP Paribas Easy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNP Paribas Easy 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 BNP Paribas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNP Paribas Easy has no effect on the direction of Capri Holdings i.e., Capri Holdings and BNP Paribas go up and down completely randomly.
Pair Corralation between Capri Holdings and BNP Paribas
If you would invest 759.00 in BNP Paribas Easy on August 30, 2024 and sell it today you would lose (6.00) from holding BNP Paribas Easy or give up 0.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 97.67% |
| Values | Daily Returns |
Capri Holdings vs. BNP Paribas Easy
Performance |
| Timeline |
| Capri Holdings |
| BNP Paribas Easy |
Capri Holdings and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and BNP Paribas
The main advantage of trading using opposite Capri Holdings and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, BNP Paribas 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 BNP Paribas will offset losses from the drop in BNP Paribas' long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. Multi Units Luxembourg | BNP Paribas vs. Lyxor UCITS MSCI | BNP Paribas vs. Lyxor Index Fund |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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