Correlation Between MACOM Technology and Celsius Holdings
Can any of the company-specific risk be diversified away by investing in both MACOM Technology 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 MACOM Technology and Celsius Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MACOM Technology Solutions and Celsius Holdings, you can compare the effects of market volatilities on MACOM Technology 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 MACOM Technology with a short position of Celsius Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MACOM Technology and Celsius Holdings.
Diversification Opportunities for MACOM Technology and Celsius Holdings
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MACOM and Celsius is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding MACOM Technology Solutions and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings and MACOM Technology 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 MACOM Technology Solutions 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 MACOM Technology i.e., MACOM Technology and Celsius Holdings go up and down completely randomly.
Pair Corralation between MACOM Technology and Celsius Holdings
Given the investment horizon of 90 days MACOM Technology Solutions is expected to generate 1.24 times more return on investment than Celsius Holdings. However, MACOM Technology is 1.24 times more volatile than Celsius Holdings. It trades about 0.19 of its potential returns per unit of risk. Celsius Holdings is currently generating about -0.04 per unit of risk. If you would invest 11,557 in MACOM Technology Solutions on August 24, 2024 and sell it today you would earn a total of 1,893 from holding MACOM Technology Solutions or generate 16.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MACOM Technology Solutions vs. Celsius Holdings
Performance |
| Timeline |
| MACOM Technology Sol |
| Celsius Holdings |
MACOM Technology and Celsius Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MACOM Technology and Celsius Holdings
The main advantage of trading using opposite MACOM Technology and Celsius Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MACOM Technology 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.| MACOM Technology vs. Eshallgo Class A | MACOM Technology vs. Amtech Systems | MACOM Technology vs. Gold Fields Ltd | MACOM Technology vs. Aegean Airlines SA |
| Celsius Holdings vs. Vita Coco | Celsius Holdings vs. Keurig Dr Pepper | Celsius Holdings vs. PepsiCo | Celsius Holdings vs. Coca Cola Femsa SAB |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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