Correlation Between Capri Holdings and Zwipe AS
Can any of the company-specific risk be diversified away by investing in both Capri Holdings and Zwipe 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 Zwipe 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 Zwipe AS, you can compare the effects of market volatilities on Capri Holdings and Zwipe 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 Zwipe AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and Zwipe AS.
Diversification Opportunities for Capri Holdings and Zwipe AS
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Capri and Zwipe is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Zwipe AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zwipe 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 Zwipe AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zwipe AS has no effect on the direction of Capri Holdings i.e., Capri Holdings and Zwipe AS go up and down completely randomly.
Pair Corralation between Capri Holdings and Zwipe AS
Given the investment horizon of 90 days Capri Holdings is expected to generate 0.5 times more return on investment than Zwipe AS. However, Capri Holdings is 1.99 times less risky than Zwipe AS. It trades about 0.1 of its potential returns per unit of risk. Zwipe AS is currently generating about -0.31 per unit of risk. If you would invest 2,139 in Capri Holdings on August 29, 2024 and sell it today you would earn a total of 145.00 from holding Capri Holdings or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capri Holdings vs. Zwipe AS
Performance |
| Timeline |
| Capri Holdings |
| Zwipe AS |
Capri Holdings and Zwipe AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capri Holdings and Zwipe AS
The main advantage of trading using opposite Capri Holdings and Zwipe AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, Zwipe 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 Zwipe AS will offset losses from the drop in Zwipe AS's long position.| Capri Holdings vs. Movado Group | Capri Holdings vs. Signet Jewelers | Capri Holdings vs. Lanvin Group Holdings | Capri Holdings vs. TheRealReal |
| Zwipe AS vs. Goobit Group AB | Zwipe AS vs. CoinShares International | Zwipe AS vs. Zignsec AB | Zwipe AS vs. Checkin Group AB |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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