Correlation Between Casella Waste and Green Mountain

Can any of the company-specific risk be diversified away by investing in both Casella Waste and Green Mountain 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 Casella Waste and Green Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Casella Waste Systems and Green Mountain Devel, you can compare the effects of market volatilities on Casella Waste and Green Mountain 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 Casella Waste with a short position of Green Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casella Waste and Green Mountain.

Diversification Opportunities for Casella Waste and Green Mountain

0.0

Correlation Coefficient

Casella Waste  Green Mountain

Pay attention - limited upside

The 3 months correlation between Casella and Green is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Casella Waste Systems and Green Mountain Devel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Mountain Devel and Casella Waste 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 Casella Waste Systems are associated (or correlated) with Green Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Mountain Devel has no effect on the direction of Casella Waste i.e., Casella Waste and Green Mountain go up and down completely randomly.

Pair Corralation between Casella Waste and Green Mountain

If you would invest  7,884  in Casella Waste Systems on September 23, 2024 and sell it today you would earn a total of  2,713  from holding Casella Waste Systems or generate 34.41% return on investment over 90 days.

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

Casella Waste Systems  vs.  Green Mountain Devel

Casella Waste Systems

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Casella Waste Systems are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Casella Waste is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Green Mountain Devel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Green Mountain Devel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Green Mountain is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Casella Waste and Green Mountain

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

The idea behind Casella Waste Systems and Green Mountain Devel 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.