Correlation Between Capri Holdings and Scanfil Oyj
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and Scanfil Oyj 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 Scanfil Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and Scanfil Oyj, you can compare the effects of market volatilities on Capri Holdings and Scanfil Oyj 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 Scanfil Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and Scanfil Oyj.
Diversification Opportunities for Capri Holdings and Scanfil Oyj
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Capri and Scanfil is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Scanfil Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scanfil Oyj 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 Scanfil Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scanfil Oyj has no effect on the direction of Capri Holdings i.e., Capri Holdings and Scanfil Oyj go up and down completely randomly.
Pair Corralation between Capri Holdings and Scanfil Oyj
Given the investment horizon of 90 days Capri Holdings is expected to under-perform the Scanfil Oyj. In addition to that, Capri Holdings is 1.55 times more volatile than Scanfil Oyj. It trades about -0.31 of its total potential returns per unit of risk. Scanfil Oyj is currently generating about 0.06 per unit of volatility. If you would invest 840.00 in Scanfil Oyj on November 28, 2024 and sell it today you would earn a total of 20.00 from holding Scanfil Oyj or generate 2.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Capri Holdings vs. Scanfil Oyj
Performance |
| Timeline |
| Capri Holdings |
| Scanfil Oyj |
Capri Holdings and Scanfil Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and Scanfil Oyj
The main advantage of trading using opposite Capri Holdings and Scanfil Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, Scanfil Oyj 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 Scanfil Oyj will offset losses from the drop in Scanfil Oyj's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| Scanfil Oyj vs. Qt Group Oyj | Scanfil Oyj vs. Revenio Group | Scanfil Oyj vs. Kamux Suomi Oy | Scanfil Oyj vs. Harvia Oyj |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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