Correlation Between Capri Holdings and FM Mattsson
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and FM Mattsson 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 FM Mattsson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and FM Mattsson Mora, you can compare the effects of market volatilities on Capri Holdings and FM Mattsson 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 FM Mattsson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and FM Mattsson.
Diversification Opportunities for Capri Holdings and FM Mattsson
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Capri and FMM-B is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and FM Mattsson Mora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FM Mattsson Mora 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 FM Mattsson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FM Mattsson Mora has no effect on the direction of Capri Holdings i.e., Capri Holdings and FM Mattsson go up and down completely randomly.
Pair Corralation between Capri Holdings and FM Mattsson
Given the investment horizon of 90 days Capri Holdings is expected to under-perform the FM Mattsson. In addition to that, Capri Holdings is 2.82 times more volatile than FM Mattsson Mora. It trades about -0.03 of its total potential returns per unit of risk. FM Mattsson Mora is currently generating about 0.02 per unit of volatility. If you would invest 5,157 in FM Mattsson Mora on September 1, 2024 and sell it today you would earn a total of 123.00 from holding FM Mattsson Mora or generate 2.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 97.67% |
| Values | Daily Returns |
Capri Holdings vs. FM Mattsson Mora
Performance |
| Timeline |
| Capri Holdings |
| FM Mattsson Mora |
Capri Holdings and FM Mattsson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and FM Mattsson
The main advantage of trading using opposite Capri Holdings and FM Mattsson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, FM Mattsson 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 FM Mattsson will offset losses from the drop in FM Mattsson's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| FM Mattsson vs. Nordic Waterproofing Holding | FM Mattsson vs. Bufab Holding AB | FM Mattsson vs. Garo AB | FM Mattsson vs. Inwido AB |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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