Correlation Between Celsius Holdings and Emerson Radio
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Emerson Radio 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 Emerson Radio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and Emerson Radio, you can compare the effects of market volatilities on Celsius Holdings and Emerson Radio 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 Emerson Radio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Emerson Radio.
Diversification Opportunities for Celsius Holdings and Emerson Radio
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Celsius and Emerson is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Emerson Radio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerson Radio 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 Emerson Radio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerson Radio has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Emerson Radio go up and down completely randomly.
Pair Corralation between Celsius Holdings and Emerson Radio
Given the investment horizon of 90 days Celsius Holdings is expected to generate 1.45 times more return on investment than Emerson Radio. However, Celsius Holdings is 1.45 times more volatile than Emerson Radio. It trades about -0.04 of its potential returns per unit of risk. Emerson Radio is currently generating about -0.12 per unit of risk. If you would invest 3,136 in Celsius Holdings on August 30, 2024 and sell it today you would lose (299.00) from holding Celsius Holdings or give up 9.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Celsius Holdings vs. Emerson Radio
Performance |
| Timeline |
| Celsius Holdings |
| Emerson Radio |
Celsius Holdings and Emerson Radio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and Emerson Radio
The main advantage of trading using opposite Celsius Holdings and Emerson Radio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Emerson Radio 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 Emerson Radio will offset losses from the drop in Emerson Radio's long position.| Celsius Holdings vs. Coca Cola Consolidated | Celsius Holdings vs. Keurig Dr Pepper | Celsius Holdings vs. PepsiCo | Celsius Holdings vs. Coca Cola Femsa SAB |
| Emerson Radio vs. VOXX International | Emerson Radio vs. LG Display Co | Emerson Radio vs. Vizio Holding Corp | Emerson Radio vs. Turtle Beach Corp |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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