Correlation Between Cimpress and Singapore Airlines

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

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

Diversification Opportunities for Cimpress and Singapore Airlines

0.17

Correlation Coefficient

Cimpress  Singapore Airlines

Average diversification

The 3 months correlation between Cimpress and Singapore is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Cimpress NV and Singapore Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Airlines 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 Singapore Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Airlines has no effect on the direction of Cimpress i.e., Cimpress and Singapore Airlines go up and down completely randomly.

Pair Corralation between Cimpress and Singapore Airlines

Given the investment horizon of 90 days Cimpress NV is expected to generate 2.71 times more return on investment than Singapore Airlines. However, Cimpress is 2.71 times more volatile than Singapore Airlines. It trades about 0.16 of its potential returns per unit of risk. Singapore Airlines is currently generating about 0.0 per unit of risk. If you would invest  4,132  in Cimpress NV on May 7, 2025 and sell it today you would earn a total of  1,256  from holding Cimpress NV or generate 30.4% return on investment over 90 days.

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

Cimpress NV  vs.  Singapore Airlines

Cimpress NV

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cimpress NV are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, Cimpress reported solid returns over the last few months and may actually be approaching a breakup point.

Singapore Airlines

Risk-Adjusted Performance

Weakest

Over the last 90 days Singapore Airlines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Singapore Airlines is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cimpress and Singapore Airlines

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

The idea behind Cimpress NV and Singapore Airlines 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.