Correlation Between Capri Holdings and KraneShares MSCI
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and KraneShares MSCI 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 KraneShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and KraneShares MSCI All, you can compare the effects of market volatilities on Capri Holdings and KraneShares MSCI 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 KraneShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and KraneShares MSCI.
Diversification Opportunities for Capri Holdings and KraneShares MSCI
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Capri and KraneShares is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and KraneShares MSCI All in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares MSCI All 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 KraneShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares MSCI All has no effect on the direction of Capri Holdings i.e., Capri Holdings and KraneShares MSCI go up and down completely randomly.
Pair Corralation between Capri Holdings and KraneShares MSCI
Given the investment horizon of 90 days Capri Holdings is expected to generate 1.55 times more return on investment than KraneShares MSCI. However, Capri Holdings is 1.55 times more volatile than KraneShares MSCI All. It trades about 0.23 of its potential returns per unit of risk. KraneShares MSCI All is currently generating about 0.02 per unit of risk. If you would invest 2,010 in Capri Holdings on September 2, 2024 and sell it today you would earn a total of 331.00 from holding Capri Holdings or generate 16.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Capri Holdings vs. KraneShares MSCI All
Performance |
| Timeline |
| Capri Holdings |
| KraneShares MSCI All |
Capri Holdings and KraneShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and KraneShares MSCI
The main advantage of trading using opposite Capri Holdings and KraneShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, KraneShares MSCI 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 KraneShares MSCI will offset losses from the drop in KraneShares MSCI's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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