Correlation Between Celsius Holdings and 552676AQ1

Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and 552676AQ1 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 552676AQ1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Celsius Holdings and MDC Holdings 6, you can compare the effects of market volatilities on Celsius Holdings and 552676AQ1 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 552676AQ1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and 552676AQ1.

Diversification Opportunities for Celsius Holdings and 552676AQ1

0.39

Correlation Coefficient

Celsius Holdings  552676AQ1

Weak diversification

The 3 months correlation between Celsius and 552676AQ1 is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and MDC Holdings 6 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MDC Holdings 6 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 552676AQ1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MDC Holdings 6 has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and 552676AQ1 go up and down completely randomly.

Pair Corralation between Celsius Holdings and 552676AQ1

Given the investment horizon of 90 days Celsius Holdings is expected to under-perform the 552676AQ1. In addition to that, Celsius Holdings is 2.88 times more volatile than MDC Holdings 6. It trades about -0.03 of its total potential returns per unit of risk. MDC Holdings 6 is currently generating about -0.07 per unit of volatility. If you would invest  10,616  in MDC Holdings 6 on September 4, 2024 and sell it today you would lose (495.00) from holding MDC Holdings 6 or give up 4.66% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	78.13%
Values	Daily Returns

Celsius Holdings  vs.  MDC Holdings 6

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.

MDC Holdings 6

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MDC Holdings 6 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 552676AQ1 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Celsius Holdings and 552676AQ1

The main advantage of trading using opposite Celsius Holdings and 552676AQ1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, 552676AQ1 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 552676AQ1 will offset losses from the drop in 552676AQ1's long position.

The idea behind Celsius Holdings and MDC Holdings 6 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.