Correlation Between Capri Holdings and Natixis ETF

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

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

Diversification Opportunities for Capri Holdings and Natixis ETF

-0.58

Correlation Coefficient

Capri Holdings  Natixis ETF

Excellent diversification

The 3 months correlation between Capri and Natixis is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and Natixis ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis ETF Trust 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 Natixis ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis ETF Trust has no effect on the direction of Capri Holdings i.e., Capri Holdings and Natixis ETF go up and down completely randomly.

Pair Corralation between Capri Holdings and Natixis ETF

Given the investment horizon of 90 days Capri Holdings is expected to under-perform the Natixis ETF. In addition to that, Capri Holdings is 11.13 times more volatile than Natixis ETF Trust. It trades about -0.05 of its total potential returns per unit of risk. Natixis ETF Trust is currently generating about 0.2 per unit of volatility. If you would invest  5,164  in Natixis ETF Trust on September 2, 2024 and sell it today you would earn a total of  403.00  from holding Natixis ETF Trust or generate 7.8% return on investment over 90 days.

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

Capri Holdings  vs.  Natixis ETF Trust

Capri Holdings

Risk-Adjusted Performance

0 of 100

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 January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Natixis ETF Trust

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Natixis ETF Trust are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Natixis ETF may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Capri Holdings and Natixis ETF

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

The idea behind Capri Holdings and Natixis ETF Trust 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.