Correlation Between Cimpress and Gray Television

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

By analyzing existing cross correlation between Cimpress NV and Gray Television, you can compare the effects of market volatilities on Cimpress and Gray Television 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 Gray Television. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cimpress and Gray Television.

Diversification Opportunities for Cimpress and Gray Television

-0.13

Correlation Coefficient

Cimpress  Gray Television

Good diversification

The 3 months correlation between Cimpress and Gray is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cimpress NV and Gray Television in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gray Television 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 Gray Television. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gray Television has no effect on the direction of Cimpress i.e., Cimpress and Gray Television go up and down completely randomly.

Pair Corralation between Cimpress and Gray Television

Given the investment horizon of 90 days Cimpress NV is expected to under-perform the Gray Television. But the stock apears to be less risky and, when comparing its historical volatility, Cimpress NV is 1.59 times less risky than Gray Television. The stock trades about -0.33 of its potential returns per unit of risk. The Gray Television is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  428.00  in Gray Television on December 2, 2024 and sell it today you would lose (52.00) from holding Gray Television or give up 12.15% of portfolio value over 90 days.

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

Cimpress NV  vs.  Gray Television

Cimpress NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cimpress NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with abnormal performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Gray Television

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gray Television has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Cimpress and Gray Television

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

The idea behind Cimpress NV and Gray Television 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.