Correlation Between Capri Holdings and S Hotels
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and S Hotels 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 S Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and S Hotels and, you can compare the effects of market volatilities on Capri Holdings and S Hotels 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 S Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and S Hotels.
Diversification Opportunities for Capri Holdings and S Hotels
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capri and SHR is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and S Hotels and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S Hotels 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 S Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S Hotels has no effect on the direction of Capri Holdings i.e., Capri Holdings and S Hotels go up and down completely randomly.
Pair Corralation between Capri Holdings and S Hotels
Given the investment horizon of 90 days Capri Holdings is expected to under-perform the S Hotels. In addition to that, Capri Holdings is 1.25 times more volatile than S Hotels and. It trades about -0.26 of its total potential returns per unit of risk. S Hotels and is currently generating about -0.02 per unit of volatility. If you would invest 206.00 in S Hotels and on November 29, 2024 and sell it today you would lose (4.00) from holding S Hotels and or give up 1.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capri Holdings vs. S Hotels and
Performance |
| Timeline |
| Capri Holdings |
| S Hotels |
Capri Holdings and S Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and S Hotels
The main advantage of trading using opposite Capri Holdings and S Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, S Hotels 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 S Hotels will offset losses from the drop in S Hotels' long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| S Hotels vs. Central Plaza Hotel | S Hotels vs. The Erawan Group | S Hotels vs. Minor International Public | S Hotels vs. Advanced Info Service |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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