Correlation Between Capri Holdings and Yield Guild

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

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

Diversification Opportunities for Capri Holdings and Yield Guild

-0.08

Correlation Coefficient

Capri Holdings  Yield Guild

Good diversification

The 3 months correlation between Capri and Yield is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Yield Guild Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yield Guild Games 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 Yield Guild. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yield Guild Games has no effect on the direction of Capri Holdings i.e., Capri Holdings and Yield Guild go up and down completely randomly.

Pair Corralation between Capri Holdings and Yield Guild

Given the investment horizon of 90 days Capri Holdings is expected to generate 0.42 times more return on investment than Yield Guild. However, Capri Holdings is 2.38 times less risky than Yield Guild. It trades about -0.07 of its potential returns per unit of risk. Yield Guild Games is currently generating about -0.2 per unit of risk. If you would invest  2,341  in Capri Holdings on November 28, 2024 and sell it today you would lose (313.00) from holding Capri Holdings or give up 13.37% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	92.06%
Values	Daily Returns

Capri Holdings  vs.  Yield Guild Games

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.

Yield Guild Games

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yield Guild Games has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's technical and fundamental indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for Yield Guild Games shareholders.

Pair Trading with Capri Holdings and Yield Guild

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

The idea behind Capri Holdings and Yield Guild Games 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 Commodity Directory module to find actively traded commodities issued by global exchanges.