Correlation Between Capri Holdings and State Street
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and State Street 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 State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capri Holdings and State Street Institutional, you can compare the effects of market volatilities on Capri Holdings and State Street 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 State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and State Street.
Diversification Opportunities for Capri Holdings and State Street
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Capri and State is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and State Street Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Institu 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 State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Institu has no effect on the direction of Capri Holdings i.e., Capri Holdings and State Street go up and down completely randomly.
Pair Corralation between Capri Holdings and State Street
Given the investment horizon of 90 days Capri Holdings is expected to under-perform the State Street. In addition to that, Capri Holdings is 5.76 times more volatile than State Street Institutional. It trades about -0.06 of its total potential returns per unit of risk. State Street Institutional is currently generating about 0.13 per unit of volatility. If you would invest 1,872 in State Street Institutional on August 29, 2024 and sell it today you would earn a total of 182.00 from holding State Street Institutional or generate 9.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capri Holdings vs. State Street Institutional
Performance |
| Timeline |
| Capri Holdings |
| State Street Institu |
Capri Holdings and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and State Street
The main advantage of trading using opposite Capri Holdings and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| State Street vs. Vanguard Small Cap Index | State Street vs. T Rowe Price | State Street vs. HUMANA INC | State Street vs. Aquagold International |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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