Correlation Between Boston Beer and Celsius Holdings
Can any of the company-specific risk be diversified away by investing in both Boston Beer 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 Boston Beer and Celsius Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Beer and Celsius Holdings, you can compare the effects of market volatilities on Boston Beer 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 Boston Beer with a short position of Celsius Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Beer and Celsius Holdings.
Diversification Opportunities for Boston Beer and Celsius Holdings
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boston and Celsius is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Boston Beer and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings and Boston Beer 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 Boston Beer 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 Boston Beer i.e., Boston Beer and Celsius Holdings go up and down completely randomly.
Pair Corralation between Boston Beer and Celsius Holdings
Considering the 90-day investment horizon Boston Beer is expected to under-perform the Celsius Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Boston Beer is 1.54 times less risky than Celsius Holdings. The stock trades about -0.01 of its potential returns per unit of risk. The Celsius Holdings is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 3,781 in Celsius Holdings on August 24, 2024 and sell it today you would lose (850.00) from holding Celsius Holdings or give up 22.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Beer vs. Celsius Holdings
Performance |
| Timeline |
| Boston Beer |
| Celsius Holdings |
Boston Beer and Celsius Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Beer and Celsius Holdings
The main advantage of trading using opposite Boston Beer and Celsius Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Beer 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.| Boston Beer vs. Anheuser Busch Inbev | Boston Beer vs. Molson Coors Beverage | Boston Beer vs. Heineken NV | Boston Beer vs. Ambev SA ADR |
| 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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