Correlation Between Capri Holdings and Bitwise Crypto

Can any of the company-specific risk be diversified away by investing in both Capri Holdings and Bitwise Crypto 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 Bitwise Crypto into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Capri Holdings and Bitwise Crypto Industry, you can compare the effects of market volatilities on Capri Holdings and Bitwise Crypto 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 Bitwise Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capri Holdings and Bitwise Crypto.

Diversification Opportunities for Capri Holdings and Bitwise Crypto

0.0

Correlation Coefficient

Capri Holdings  Bitwise Crypto

Pay attention - limited upside

The 3 months correlation between Capri and Bitwise is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Bitwise Crypto Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitwise Crypto Industry 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 Bitwise Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitwise Crypto Industry has no effect on the direction of Capri Holdings i.e., Capri Holdings and Bitwise Crypto go up and down completely randomly.

Pair Corralation between Capri Holdings and Bitwise Crypto

Given the investment horizon of 90 days Capri Holdings is expected to under-perform the Bitwise Crypto. In addition to that, Capri Holdings is 1.39 times more volatile than Bitwise Crypto Industry. It trades about -0.31 of its total potential returns per unit of risk. Bitwise Crypto Industry is currently generating about -0.2 per unit of volatility. If you would invest  1,753  in Bitwise Crypto Industry on November 28, 2024 and sell it today you would lose (167.00) from holding Bitwise Crypto Industry or give up 9.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Capri Holdings  vs.  Bitwise Crypto Industry

Capri Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Capri Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Bitwise Crypto Industry

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bitwise Crypto Industry has generated negative risk-adjusted returns adding no value to investors with long positions. Even with abnormal performance in the last few months, the Etf's basic indicators remain relatively invariable which may send shares a bit higher in March 2025. The latest agitation may also be a sign of long-running up-swing for the ETF retail investors.

Pair Trading with Capri Holdings and Bitwise Crypto

The main advantage of trading using opposite Capri Holdings and Bitwise Crypto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capri Holdings position performs unexpectedly, Bitwise Crypto 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 Bitwise Crypto will offset losses from the drop in Bitwise Crypto's long position.

The idea behind Capri Holdings and Bitwise Crypto Industry pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.