Correlation Between Contagious Gaming and Celsius Holdings

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

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

Diversification Opportunities for Contagious Gaming and Celsius Holdings

0.0

Correlation Coefficient

Contagious Gaming  Celsius Holdings

Pay attention - limited upside

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

Pair Corralation between Contagious Gaming and Celsius Holdings

Assuming the 90 days horizon Contagious Gaming is expected to under-perform the Celsius Holdings. In addition to that, Contagious Gaming is 1.31 times more volatile than Celsius Holdings. It trades about -0.06 of its total potential returns per unit of risk. Celsius Holdings is currently generating about -0.03 per unit of volatility. If you would invest  4,984  in Celsius Holdings on September 30, 2024 and sell it today you would lose (2,338) from holding Celsius Holdings or give up 46.91% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.47%
Values	Daily Returns

Contagious Gaming  vs.  Celsius Holdings

Contagious Gaming

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Contagious Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Contagious Gaming is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

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.

Pair Trading with Contagious Gaming and Celsius Holdings

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

The idea behind Contagious Gaming and Celsius Holdings 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.