Correlation Between Eastman Chemical and Cimpress
Can any of the company-specific risk be diversified away by investing in both Eastman Chemical 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 Eastman Chemical and Cimpress into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Chemical and Cimpress NV, you can compare the effects of market volatilities on Eastman Chemical 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 Eastman Chemical with a short position of Cimpress. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Chemical and Cimpress.
Diversification Opportunities for Eastman Chemical and Cimpress
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eastman and Cimpress is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Chemical and Cimpress NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cimpress NV and Eastman Chemical 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 Eastman Chemical 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 Eastman Chemical i.e., Eastman Chemical and Cimpress go up and down completely randomly.
Pair Corralation between Eastman Chemical and Cimpress
Considering the 90-day investment horizon Eastman Chemical is expected to generate 4.01 times less return on investment than Cimpress. But when comparing it to its historical volatility, Eastman Chemical is 2.16 times less risky than Cimpress. It trades about 0.04 of its potential returns per unit of risk. Cimpress NV is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,743 in Cimpress NV on August 30, 2024 and sell it today you would earn a total of 5,303 from holding Cimpress NV or generate 193.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastman Chemical vs. Cimpress NV
Performance |
| Timeline |
| Eastman Chemical |
| Cimpress NV |
Eastman Chemical and Cimpress Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Chemical and Cimpress
The main advantage of trading using opposite Eastman Chemical and Cimpress positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Chemical 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.| Eastman Chemical vs. Direxion Daily FTSE | Eastman Chemical vs. Collegium Pharmaceutical | Eastman Chemical vs. KKR Co LP | Eastman Chemical vs. iShares Dividend and |
| Cimpress vs. CannBioRx Life Sciences | Cimpress vs. GCM Grosvenor | Cimpress vs. CuriosityStream | Cimpress vs. HUMANA INC |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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