Correlation Between Alaska Air and Cimpress
Can any of the company-specific risk be diversified away by investing in both Alaska Air and Cimpress 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 Alaska Air and Cimpress into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alaska Air Group and Cimpress NV, you can compare the effects of market volatilities on Alaska Air and Cimpress 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 Alaska Air with a short position of Cimpress. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Air and Cimpress.
Diversification Opportunities for Alaska Air and Cimpress
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alaska and Cimpress is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Air Group and Cimpress NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cimpress NV and Alaska Air 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 Alaska Air Group are associated (or correlated) with Cimpress. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cimpress NV has no effect on the direction of Alaska Air i.e., Alaska Air and Cimpress go up and down completely randomly.
Pair Corralation between Alaska Air and Cimpress
Considering the 90-day investment horizon Alaska Air Group is expected to generate 0.93 times more return on investment than Cimpress. However, Alaska Air Group is 1.07 times less risky than Cimpress. It trades about 0.0 of its potential returns per unit of risk. Cimpress NV is currently generating about -0.04 per unit of risk. If you would invest 6,760 in Alaska Air Group on October 25, 2024 and sell it today you would lose (20.00) from holding Alaska Air Group or give up 0.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alaska Air Group vs. Cimpress NV
Performance |
| Timeline |
| Alaska Air Group |
| Cimpress NV |
Alaska Air and Cimpress Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alaska Air and Cimpress
The main advantage of trading using opposite Alaska Air and Cimpress positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alaska Air position performs unexpectedly, Cimpress 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 Cimpress will offset losses from the drop in Cimpress' long position.| Alaska Air vs. Delta Air Lines | Alaska Air vs. United Airlines Holdings | Alaska Air vs. American Airlines Group | Alaska Air vs. JetBlue Airways Corp |
| Cimpress vs. Innovid Corp | Cimpress vs. Deluxe | Cimpress vs. Omnicom Group | Cimpress vs. Emerald Expositions Events |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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