Correlation Between Celsius Holdings and X-FAB Silicon
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and X-FAB Silicon 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 X-FAB Silicon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and X FAB Silicon Foundries, you can compare the effects of market volatilities on Celsius Holdings and X-FAB Silicon 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 X-FAB Silicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and X-FAB Silicon.
Diversification Opportunities for Celsius Holdings and X-FAB Silicon
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Celsius and X-FAB is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and X FAB Silicon Foundries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on X FAB Silicon 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 X-FAB Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of X FAB Silicon has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and X-FAB Silicon go up and down completely randomly.
Pair Corralation between Celsius Holdings and X-FAB Silicon
Given the investment horizon of 90 days Celsius Holdings is expected to under-perform the X-FAB Silicon. In addition to that, Celsius Holdings is 1.11 times more volatile than X FAB Silicon Foundries. It trades about -0.08 of its total potential returns per unit of risk. X FAB Silicon Foundries is currently generating about 0.16 per unit of volatility. If you would invest 449.00 in X FAB Silicon Foundries on October 26, 2024 and sell it today you would earn a total of 89.00 from holding X FAB Silicon Foundries or generate 19.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.5% |
| Values | Daily Returns |
Celsius Holdings vs. X FAB Silicon Foundries
Performance |
| Timeline |
| Celsius Holdings |
| X FAB Silicon |
Celsius Holdings and X-FAB Silicon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and X-FAB Silicon
The main advantage of trading using opposite Celsius Holdings and X-FAB Silicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, X-FAB Silicon 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 X-FAB Silicon will offset losses from the drop in X-FAB Silicon's long position.| Celsius Holdings vs. PepsiCo | Celsius Holdings vs. Vita Coco | Celsius Holdings vs. Aquagold International | Celsius Holdings vs. Thrivent High Yield |
| X-FAB Silicon vs. NVIDIA | X-FAB Silicon vs. Intel | X-FAB Silicon vs. Taiwan Semiconductor Manufacturing | X-FAB Silicon vs. Marvell Technology Group |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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