Correlation Between Epizyme and Cimpress

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

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

Diversification Opportunities for Epizyme and Cimpress

0.33

Correlation Coefficient

Epizyme  Cimpress

Weak diversification

The 3 months correlation between Epizyme and Cimpress is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Epizyme and Cimpress NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cimpress NV and Epizyme 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 Epizyme 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 Epizyme i.e., Epizyme and Cimpress go up and down completely randomly.

Pair Corralation between Epizyme and Cimpress

If you would invest  147.00  in Epizyme on January 31, 2024 and sell it today you would earn a total of  0.00  from holding Epizyme or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

Epizyme  vs.  Cimpress NV

Epizyme

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Epizyme has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Epizyme is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Cimpress NV

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cimpress NV are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Cimpress reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Epizyme and Cimpress

The main advantage of trading using opposite Epizyme and Cimpress positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Epizyme 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.

The idea behind Epizyme and Cimpress NV 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.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.