Correlation Between Ecoloclean Industrs and Casella Waste

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

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

Diversification Opportunities for Ecoloclean Industrs and Casella Waste

0.0

Correlation Coefficient

Ecoloclean Industrs  Casella Waste

Pay attention - limited upside

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

Pair Corralation between Ecoloclean Industrs and Casella Waste

If you would invest  10,840  in Casella Waste Systems on September 14, 2024 and sell it today you would earn a total of  171.00  from holding Casella Waste Systems or generate 1.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Ecoloclean Industrs  vs.  Casella Waste Systems

Ecoloclean Industrs

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ecoloclean Industrs has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, Ecoloclean Industrs is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Casella Waste Systems

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Casella Waste Systems are ranked lower than 1 (%) 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 recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Ecoloclean Industrs and Casella Waste

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

The idea behind Ecoloclean Industrs and Casella Waste Systems 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.