Correlation Between Capri Holdings and Masoval AS
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and Masoval AS 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 Masoval AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and Masoval AS, you can compare the effects of market volatilities on Capri Holdings and Masoval AS 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 Masoval AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and Masoval AS.
Diversification Opportunities for Capri Holdings and Masoval AS
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Capri and Masoval is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Masoval AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Masoval AS 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 Masoval AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Masoval AS has no effect on the direction of Capri Holdings i.e., Capri Holdings and Masoval AS go up and down completely randomly.
Pair Corralation between Capri Holdings and Masoval AS
Given the investment horizon of 90 days Capri Holdings is expected to generate 1.52 times more return on investment than Masoval AS. However, Capri Holdings is 1.52 times more volatile than Masoval AS. It trades about 0.26 of its potential returns per unit of risk. Masoval AS is currently generating about 0.04 per unit of risk. If you would invest 1,974 in Capri Holdings on September 1, 2024 and sell it today you would earn a total of 367.00 from holding Capri Holdings or generate 18.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Capri Holdings vs. Masoval AS
Performance |
| Timeline |
| Capri Holdings |
| Masoval AS |
Capri Holdings and Masoval AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and Masoval AS
The main advantage of trading using opposite Capri Holdings and Masoval AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, Masoval AS 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 Masoval AS will offset losses from the drop in Masoval AS's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| Masoval AS vs. Andfjord Salmon AS | Masoval AS vs. Elkem ASA | Masoval AS vs. Integrated Wind Solutions | Masoval AS vs. Vow ASA |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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