Correlation Between Sui and Celestia
Can any of the company-specific risk be diversified away by investing in both Sui and Celestia 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 Sui and Celestia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sui and Celestia, you can compare the effects of market volatilities on Sui and Celestia 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 Sui with a short position of Celestia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sui and Celestia.
Diversification Opportunities for Sui and Celestia
Significant diversification
The 3 months correlation between Sui and Celestia is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Sui and Celestia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celestia and Sui 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 Sui are associated (or correlated) with Celestia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celestia has no effect on the direction of Sui i.e., Sui and Celestia go up and down completely randomly.
Pair Corralation between Sui and Celestia
Assuming the 90 days trading horizon Sui is expected to generate 0.99 times more return on investment than Celestia. However, Sui is 1.01 times less risky than Celestia. It trades about -0.01 of its potential returns per unit of risk. Celestia is currently generating about -0.09 per unit of risk. If you would invest 460.00 in Sui on October 23, 2024 and sell it today you would lose (27.00) from holding Sui or give up 5.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sui vs. Celestia
Performance |
| Timeline |
| Sui |
| Celestia |
Sui and Celestia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sui and Celestia
The main advantage of trading using opposite Sui and Celestia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sui position performs unexpectedly, Celestia 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 Celestia will offset losses from the drop in Celestia's long position.The idea behind Sui and Celestia pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |