Correlation Between Innovative Industrial and Celsius Holdings
Can any of the company-specific risk be diversified away by investing in both Innovative Industrial and Celsius Holdings 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 Innovative Industrial and Celsius Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovative Industrial Properties and Celsius Holdings, you can compare the effects of market volatilities on Innovative Industrial and Celsius Holdings 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 Innovative Industrial with a short position of Celsius Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Industrial and Celsius Holdings.
Diversification Opportunities for Innovative Industrial and Celsius Holdings
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Innovative and Celsius is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Industrial Properti and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings and Innovative Industrial 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 Innovative Industrial Properties are associated (or correlated) with Celsius Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celsius Holdings has no effect on the direction of Innovative Industrial i.e., Innovative Industrial and Celsius Holdings go up and down completely randomly.
Pair Corralation between Innovative Industrial and Celsius Holdings
Assuming the 90 days trading horizon Innovative Industrial Properties is expected to under-perform the Celsius Holdings. But the preferred stock apears to be less risky and, when comparing its historical volatility, Innovative Industrial Properties is 3.25 times less risky than Celsius Holdings. The preferred stock trades about -0.03 of its potential returns per unit of risk. The Celsius Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,349 in Celsius Holdings on September 24, 2024 and sell it today you would lose (648.00) from holding Celsius Holdings or give up 19.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 89.94% |
| Values | Daily Returns |
Innovative Industrial Properti vs. Celsius Holdings
Performance |
| Timeline |
| Innovative Industrial |
| Celsius Holdings |
Innovative Industrial and Celsius Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovative Industrial and Celsius Holdings
The main advantage of trading using opposite Innovative Industrial and Celsius Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Industrial position performs unexpectedly, Celsius Holdings 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 Celsius Holdings will offset losses from the drop in Celsius Holdings' long position.| Innovative Industrial vs. Celsius Holdings | Innovative Industrial vs. National Beverage Corp | Innovative Industrial vs. Amkor Technology | Innovative Industrial vs. Uber Technologies |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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