Correlation Between Kering SA and Tapestry
Can any of the company-specific risk be diversified away by investing in both Kering SA and Tapestry 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 Kering SA and Tapestry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kering SA and Tapestry, you can compare the effects of market volatilities on Kering SA and Tapestry 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 Kering SA with a short position of Tapestry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kering SA and Tapestry.
Diversification Opportunities for Kering SA and Tapestry
Excellent diversification
The 3 months correlation between Kering and Tapestry is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Kering SA and Tapestry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tapestry and Kering SA 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 Kering SA are associated (or correlated) with Tapestry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tapestry has no effect on the direction of Kering SA i.e., Kering SA and Tapestry go up and down completely randomly.
Pair Corralation between Kering SA and Tapestry
Assuming the 90 days horizon Kering SA is expected to under-perform the Tapestry. In addition to that, Kering SA is 1.08 times more volatile than Tapestry. It trades about -0.08 of its total potential returns per unit of risk. Tapestry is currently generating about 0.23 per unit of volatility. If you would invest 4,122 in Tapestry on August 31, 2024 and sell it today you would earn a total of 1,970 from holding Tapestry or generate 47.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kering SA vs. Tapestry
Performance |
| Timeline |
| Kering SA |
| Tapestry |
Kering SA and Tapestry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kering SA and Tapestry
The main advantage of trading using opposite Kering SA and Tapestry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kering SA position performs unexpectedly, Tapestry 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 Tapestry will offset losses from the drop in Tapestry's long position.| Kering SA vs. Burberry Group Plc | Kering SA vs. Swatch Group AG | Kering SA vs. Prada Spa PK | Kering SA vs. Compagnie Financire Richemont |
| Tapestry vs. Signet Jewelers | Tapestry vs. Movado Group | Tapestry vs. Lanvin Group Holdings | Tapestry vs. TheRealReal |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |