Correlation Between Cimpress and Software Acquisition
Can any of the company-specific risk be diversified away by investing in both Cimpress and Software Acquisition 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 Cimpress and Software Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cimpress NV and Software Acquisition Group, you can compare the effects of market volatilities on Cimpress and Software Acquisition 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 Cimpress with a short position of Software Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cimpress and Software Acquisition.
Diversification Opportunities for Cimpress and Software Acquisition
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cimpress and Software is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Cimpress NV and Software Acquisition Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Software Acquisition and Cimpress 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 Cimpress NV are associated (or correlated) with Software Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Software Acquisition has no effect on the direction of Cimpress i.e., Cimpress and Software Acquisition go up and down completely randomly.
Pair Corralation between Cimpress and Software Acquisition
Given the investment horizon of 90 days Cimpress is expected to generate 40.81 times less return on investment than Software Acquisition. But when comparing it to its historical volatility, Cimpress NV is 29.5 times less risky than Software Acquisition. It trades about 0.08 of its potential returns per unit of risk. Software Acquisition Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 10.00 in Software Acquisition Group on September 13, 2024 and sell it today you would lose (8.80) from holding Software Acquisition Group or give up 88.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 44.53% |
| Values | Daily Returns |
Cimpress NV vs. Software Acquisition Group
Performance |
| Timeline |
| Cimpress NV |
| Software Acquisition |
Cimpress and Software Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cimpress and Software Acquisition
The main advantage of trading using opposite Cimpress and Software Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cimpress position performs unexpectedly, Software Acquisition 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 Software Acquisition will offset losses from the drop in Software Acquisition's long position.| Cimpress vs. Innovid Corp | Cimpress vs. Deluxe | Cimpress vs. Omnicom Group | Cimpress vs. Emerald Expositions Events |
| Software Acquisition vs. Luxfer Holdings PLC | Software Acquisition vs. Ecovyst | Software Acquisition vs. Codexis | Software Acquisition vs. Eastman Chemical |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |