Correlation Between Capri Holdings and The Hartford
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and The Hartford 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 The Hartford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and The Hartford Growth, you can compare the effects of market volatilities on Capri Holdings and The Hartford 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 The Hartford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and The Hartford.
Diversification Opportunities for Capri Holdings and The Hartford
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Capri and The is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth 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 The Hartford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Growth has no effect on the direction of Capri Holdings i.e., Capri Holdings and The Hartford go up and down completely randomly.
Pair Corralation between Capri Holdings and The Hartford
Given the investment horizon of 90 days Capri Holdings is expected to generate 3.09 times more return on investment than The Hartford. However, Capri Holdings is 3.09 times more volatile than The Hartford Growth. It trades about 0.1 of its potential returns per unit of risk. The Hartford Growth is currently generating about 0.15 per unit of risk. If you would invest 2,139 in Capri Holdings on August 29, 2024 and sell it today you would earn a total of 145.00 from holding Capri Holdings or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Capri Holdings vs. The Hartford Growth
Performance |
| Timeline |
| Capri Holdings |
| Hartford Growth |
Capri Holdings and The Hartford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and The Hartford
The main advantage of trading using opposite Capri Holdings and The Hartford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, The Hartford 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 The Hartford will offset losses from the drop in The Hartford's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| The Hartford vs. Energy Services Fund | The Hartford vs. Oil Gas Ultrasector | The Hartford vs. Ivy Natural Resources | The Hartford vs. Alpsalerian Energy Infrastructure |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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