Correlation Between Capri Holdings and LF Capital
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and LF Capital 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 LF Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and LF Capital Acquisition, you can compare the effects of market volatilities on Capri Holdings and LF Capital 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 LF Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and LF Capital.
Diversification Opportunities for Capri Holdings and LF Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Capri and LFACW is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and LF Capital Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LF Capital Acquisition 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 LF Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LF Capital Acquisition has no effect on the direction of Capri Holdings i.e., Capri Holdings and LF Capital go up and down completely randomly.
Pair Corralation between Capri Holdings and LF Capital
If you would invest (100.00) in LF Capital Acquisition on September 1, 2024 and sell it today you would earn a total of 100.00 from holding LF Capital Acquisition or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Capri Holdings vs. LF Capital Acquisition
Performance |
| Timeline |
| Capri Holdings |
| LF Capital Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Capri Holdings and LF Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and LF Capital
The main advantage of trading using opposite Capri Holdings and LF Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, LF Capital 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 LF Capital will offset losses from the drop in LF Capital's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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