Correlation Between Casella Waste and Critic Clothing
Can any of the company-specific risk be diversified away by investing in both Casella Waste and Critic Clothing 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 Casella Waste and Critic Clothing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Casella Waste Systems and Critic Clothing, you can compare the effects of market volatilities on Casella Waste and Critic Clothing 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 Casella Waste with a short position of Critic Clothing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casella Waste and Critic Clothing.
Diversification Opportunities for Casella Waste and Critic Clothing
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Casella and Critic is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Casella Waste Systems and Critic Clothing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Critic Clothing and Casella Waste 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 Casella Waste Systems are associated (or correlated) with Critic Clothing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Critic Clothing has no effect on the direction of Casella Waste i.e., Casella Waste and Critic Clothing go up and down completely randomly.
Pair Corralation between Casella Waste and Critic Clothing
Given the investment horizon of 90 days Casella Waste Systems is expected to generate 0.05 times more return on investment than Critic Clothing. However, Casella Waste Systems is 21.48 times less risky than Critic Clothing. It trades about 0.1 of its potential returns per unit of risk. Critic Clothing is currently generating about -0.08 per unit of risk. If you would invest 10,751 in Casella Waste Systems on September 13, 2024 and sell it today you would earn a total of 260.00 from holding Casella Waste Systems or generate 2.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Casella Waste Systems vs. Critic Clothing
Performance |
| Timeline |
| Casella Waste Systems |
| Critic Clothing |
Casella Waste and Critic Clothing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Casella Waste and Critic Clothing
The main advantage of trading using opposite Casella Waste and Critic Clothing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casella Waste position performs unexpectedly, Critic Clothing 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 Critic Clothing will offset losses from the drop in Critic Clothing's long position.| Casella Waste vs. Clean Harbors | Casella Waste vs. Montrose Environmental Grp | Casella Waste vs. Republic Services | Casella Waste vs. Waste Connections |
| Critic Clothing vs. Ecoloclean Industrs | Critic Clothing vs. Ecosciences | Critic Clothing vs. JPX Global | Critic Clothing vs. Majic Wheels 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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