Correlation Between Celsius Holdings and Primo Water
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Primo Water 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 Primo Water into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and Primo Water Corp, you can compare the effects of market volatilities on Celsius Holdings and Primo Water 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 Primo Water. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Primo Water.
Diversification Opportunities for Celsius Holdings and Primo Water
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Celsius and Primo is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Primo Water Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Primo Water Corp 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 Primo Water. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Primo Water Corp has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Primo Water go up and down completely randomly.
Pair Corralation between Celsius Holdings and Primo Water
Given the investment horizon of 90 days Celsius Holdings is expected to generate 2.18 times more return on investment than Primo Water. However, Celsius Holdings is 2.18 times more volatile than Primo Water Corp. It trades about -0.05 of its potential returns per unit of risk. Primo Water Corp is currently generating about -0.5 per unit of risk. If you would invest 3,046 in Celsius Holdings on August 24, 2024 and sell it today you would lose (141.00) from holding Celsius Holdings or give up 4.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 63.64% |
| Values | Daily Returns |
Celsius Holdings vs. Primo Water Corp
Performance |
| Timeline |
| Celsius Holdings |
| Primo Water Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Celsius Holdings and Primo Water Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and Primo Water
The main advantage of trading using opposite Celsius Holdings and Primo Water positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Primo Water 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 Primo Water will offset losses from the drop in Primo Water'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 |
| Primo Water vs. Bit Origin | Primo Water vs. Laird Superfood | Primo Water vs. Planet Green Holdings | Primo Water vs. Stryve Foods |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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