Correlation Between Capri Holdings and PVH Corp

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

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

Diversification Opportunities for Capri Holdings and PVH Corp

0.34

Correlation Coefficient

Capri Holdings  PVH Corp

Weak diversification

The 3 months correlation between Capri and PVH is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Capri Holdings and PVH Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PVH Corp 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 PVH Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PVH Corp has no effect on the direction of Capri Holdings i.e., Capri Holdings and PVH Corp go up and down completely randomly.

Pair Corralation between Capri Holdings and PVH Corp

Given the investment horizon of 90 days Capri Holdings is expected to generate 0.85 times more return on investment than PVH Corp. However, Capri Holdings is 1.18 times less risky than PVH Corp. It trades about 0.07 of its potential returns per unit of risk. PVH Corp is currently generating about 0.02 per unit of risk. If you would invest  1,541  in Capri Holdings on May 4, 2025 and sell it today you would earn a total of  158.00  from holding Capri Holdings or generate 10.25% return on investment over 90 days.

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

Capri Holdings  vs.  PVH Corp

Capri Holdings

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Capri Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Capri Holdings may actually be approaching a critical reversion point that can send shares even higher in September 2025.

PVH Corp

Risk-Adjusted Performance

Weak

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

Pair Trading with Capri Holdings and PVH Corp

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

The idea behind Capri Holdings and PVH Corp 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.