Correlation Between Celsius Holdings and Cars
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Cars 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 Cars into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and Cars Inc, you can compare the effects of market volatilities on Celsius Holdings and Cars 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 Cars. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Cars.
Diversification Opportunities for Celsius Holdings and Cars
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Celsius and Cars is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Cars Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cars Inc 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 Cars. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cars Inc has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Cars go up and down completely randomly.
Pair Corralation between Celsius Holdings and Cars
Given the investment horizon of 90 days Celsius Holdings is expected to under-perform the Cars. In addition to that, Celsius Holdings is 1.81 times more volatile than Cars Inc. It trades about -0.03 of its total potential returns per unit of risk. Cars Inc is currently generating about 0.01 per unit of volatility. If you would invest 1,917 in Cars Inc on September 12, 2024 and sell it today you would earn a total of 17.00 from holding Cars Inc or generate 0.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Celsius Holdings vs. Cars Inc
Performance |
| Timeline |
| Celsius Holdings |
| Cars Inc |
Celsius Holdings and Cars Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and Cars
The main advantage of trading using opposite Celsius Holdings and Cars positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Cars 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 Cars will offset losses from the drop in Cars' long position.| Celsius Holdings vs. Monster Beverage Corp | Celsius Holdings vs. Coca Cola Femsa SAB | Celsius Holdings vs. Keurig Dr Pepper | Celsius Holdings vs. Embotelladora Andina SA |
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.
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