Correlation Between Ferrari NV and Copart

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

By analyzing existing cross correlation between Ferrari NV and Copart Inc, you can compare the effects of market volatilities on Ferrari NV and Copart 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 Ferrari NV with a short position of Copart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ferrari NV and Copart.

Diversification Opportunities for Ferrari NV and Copart

0.7

Correlation Coefficient

Ferrari NV  Copart

Poor diversification

The 3 months correlation between Ferrari and Copart is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Ferrari NV and Copart Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copart Inc and Ferrari NV 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 Ferrari NV are associated (or correlated) with Copart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copart Inc has no effect on the direction of Ferrari NV i.e., Ferrari NV and Copart go up and down completely randomly.

Pair Corralation between Ferrari NV and Copart

Given the investment horizon of 90 days Ferrari NV is expected to under-perform the Copart. In addition to that, Ferrari NV is 1.89 times more volatile than Copart Inc. It trades about -0.14 of its total potential returns per unit of risk. Copart Inc is currently generating about -0.21 per unit of volatility. If you would invest  4,662  in Copart Inc on September 17, 2025 and sell it today you would lose (795.00) from holding Copart Inc or give up 17.05% of portfolio value over 90 days.

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

Ferrari NV  vs.  Copart Inc

Ferrari NV

Risk-Adjusted Performance

Weakest

Over the last 90 days Ferrari NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in January 2026. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Copart Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Copart Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2026. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Ferrari NV and Copart

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

The idea behind Ferrari NV and Copart Inc 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.

Check out your portfolio center.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.