Correlation Between Capri Holdings and Ubs International

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

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

Diversification Opportunities for Capri Holdings and Ubs International

-0.23

Correlation Coefficient

Capri Holdings  Ubs International

Very good diversification

The 3 months correlation between Capri and Ubs is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Ubs International Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ubs International 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 Ubs International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ubs International has no effect on the direction of Capri Holdings i.e., Capri Holdings and Ubs International go up and down completely randomly.

Pair Corralation between Capri Holdings and Ubs International

Given the investment horizon of 90 days Capri Holdings is expected to generate 1.77 times less return on investment than Ubs International. In addition to that, Capri Holdings is 3.62 times more volatile than Ubs International Sustainable. It trades about 0.02 of its total potential returns per unit of risk. Ubs International Sustainable is currently generating about 0.12 per unit of volatility. If you would invest  1,000.00  in Ubs International Sustainable on December 28, 2024 and sell it today you would earn a total of  69.00  from holding Ubs International Sustainable or generate 6.9% return on investment over 90 days.

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

Capri Holdings  vs.  Ubs International Sustainable

Capri Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Capri Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Capri Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Ubs International

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ubs International Sustainable are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Ubs International may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Capri Holdings and Ubs International

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

The idea behind Capri Holdings and Ubs International Sustainable 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.