Correlation Between Celsius Holdings and Oatly Group
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Oatly Group 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 Oatly Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and Oatly Group AB, you can compare the effects of market volatilities on Celsius Holdings and Oatly Group 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 Oatly Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Oatly Group.
Diversification Opportunities for Celsius Holdings and Oatly Group
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Celsius and Oatly is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Oatly Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oatly Group AB 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 Oatly Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oatly Group AB has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Oatly Group go up and down completely randomly.
Pair Corralation between Celsius Holdings and Oatly Group
Given the investment horizon of 90 days Celsius Holdings is expected to under-perform the Oatly Group. But the stock apears to be less risky and, when comparing its historical volatility, Celsius Holdings is 1.35 times less risky than Oatly Group. The stock trades about -0.49 of its potential returns per unit of risk. The Oatly Group AB is currently generating about -0.22 of returns per unit of risk over similar time horizon. If you would invest 68.00 in Oatly Group AB on November 9, 2024 and sell it today you would lose (11.00) from holding Oatly Group AB or give up 16.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Celsius Holdings vs. Oatly Group AB
Performance |
| Timeline |
| Celsius Holdings |
| Oatly Group AB |
Celsius Holdings and Oatly Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and Oatly Group
The main advantage of trading using opposite Celsius Holdings and Oatly Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Oatly Group 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 Oatly Group will offset losses from the drop in Oatly Group's long position.| Celsius Holdings vs. Vita Coco | Celsius Holdings vs. Keurig Dr Pepper | Celsius Holdings vs. PepsiCo | Celsius Holdings vs. Coca Cola Femsa SAB |
| Oatly Group vs. Monster Beverage Corp | Oatly Group vs. Vita Coco | Oatly Group vs. PepsiCo | Oatly Group vs. The Coca Cola |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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