Correlation Between Celsius Holdings and Sanyo Special

Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Sanyo Special 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 Celsius Holdings and Sanyo Special into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Celsius Holdings and Sanyo Special Steel, you can compare the effects of market volatilities on Celsius Holdings and Sanyo Special 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 Celsius Holdings with a short position of Sanyo Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Sanyo Special.

Diversification Opportunities for Celsius Holdings and Sanyo Special

-0.25

Correlation Coefficient

Celsius Holdings  Sanyo Special

Very good diversification

The 3 months correlation between Celsius and Sanyo is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Sanyo Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanyo Special Steel and Celsius Holdings 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 Celsius Holdings are associated (or correlated) with Sanyo Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanyo Special Steel has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Sanyo Special go up and down completely randomly.

Pair Corralation between Celsius Holdings and Sanyo Special

Given the investment horizon of 90 days Celsius Holdings is expected to generate 56.23 times more return on investment than Sanyo Special. However, Celsius Holdings is 56.23 times more volatile than Sanyo Special Steel. It trades about 0.01 of its potential returns per unit of risk. Sanyo Special Steel is currently generating about 0.06 per unit of risk. If you would invest  3,374  in Celsius Holdings on September 26, 2024 and sell it today you would lose (638.00) from holding Celsius Holdings or give up 18.91% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Celsius Holdings  vs.  Sanyo Special Steel

Celsius Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Celsius Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's essential indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Sanyo Special Steel

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sanyo Special Steel are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable essential indicators, Sanyo Special is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Celsius Holdings and Sanyo Special

The main advantage of trading using opposite Celsius Holdings and Sanyo Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Sanyo Special 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 Sanyo Special will offset losses from the drop in Sanyo Special's long position.

The idea behind Celsius Holdings and Sanyo Special Steel 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.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.