Correlation Between Capri Holdings and Netcompany Group
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and Netcompany Group 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 Netcompany Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and Netcompany Group AS, you can compare the effects of market volatilities on Capri Holdings and Netcompany Group 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 Netcompany Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and Netcompany Group.
Diversification Opportunities for Capri Holdings and Netcompany Group
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capri and Netcompany is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Netcompany Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netcompany Group 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 Netcompany Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netcompany Group has no effect on the direction of Capri Holdings i.e., Capri Holdings and Netcompany Group go up and down completely randomly.
Pair Corralation between Capri Holdings and Netcompany Group
Given the investment horizon of 90 days Capri Holdings is expected to under-perform the Netcompany Group. In addition to that, Capri Holdings is 1.74 times more volatile than Netcompany Group AS. It trades about -0.02 of its total potential returns per unit of risk. Netcompany Group AS is currently generating about 0.03 per unit of volatility. If you would invest 24,500 in Netcompany Group AS on November 27, 2024 and sell it today you would earn a total of 4,820 from holding Netcompany Group AS or generate 19.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Capri Holdings vs. Netcompany Group AS
Performance |
| Timeline |
| Capri Holdings |
| Netcompany Group |
Capri Holdings and Netcompany Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and Netcompany Group
The main advantage of trading using opposite Capri Holdings and Netcompany Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, Netcompany Group 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 Netcompany Group will offset losses from the drop in Netcompany Group's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| Netcompany Group vs. GN Store Nord | Netcompany Group vs. Ambu AS | Netcompany Group vs. ROCKWOOL International AS | Netcompany Group vs. Genmab AS |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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