Correlation Between Celsius Holdings and Albemarle
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Albemarle 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 Celsius Holdings and Albemarle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and Albemarle, you can compare the effects of market volatilities on Celsius Holdings and Albemarle 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 Celsius Holdings with a short position of Albemarle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Albemarle.
Diversification Opportunities for Celsius Holdings and Albemarle
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Celsius and Albemarle is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Albemarle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Albemarle and Celsius Holdings 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 Celsius Holdings are associated (or correlated) with Albemarle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Albemarle has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Albemarle go up and down completely randomly.
Pair Corralation between Celsius Holdings and Albemarle
Given the investment horizon of 90 days Celsius Holdings is expected to generate 1.6 times more return on investment than Albemarle. However, Celsius Holdings is 1.6 times more volatile than Albemarle. It trades about -0.08 of its potential returns per unit of risk. Albemarle is currently generating about -0.16 per unit of risk. If you would invest 2,975 in Celsius Holdings on October 26, 2024 and sell it today you would lose (398.00) from holding Celsius Holdings or give up 13.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.5% |
| Values | Daily Returns |
Celsius Holdings vs. Albemarle
Performance |
| Timeline |
| Celsius Holdings |
| Albemarle |
Celsius Holdings and Albemarle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and Albemarle
The main advantage of trading using opposite Celsius Holdings and Albemarle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Albemarle 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 Albemarle will offset losses from the drop in Albemarle's long position.| Celsius Holdings vs. PepsiCo | Celsius Holdings vs. Vita Coco | Celsius Holdings vs. Aquagold International | Celsius Holdings vs. Thrivent High Yield |
| Albemarle vs. Verra Mobility Corp | Albemarle vs. Sun Country Airlines | Albemarle vs. Braskem SA Class | Albemarle vs. Balchem |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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