Correlation Between Celsius Holdings and Aegon NV

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

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

Diversification Opportunities for Celsius Holdings and Aegon NV

0.07

Correlation Coefficient

Celsius Holdings  Aegon NV

Significant diversification

The 3 months correlation between Celsius and Aegon is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Aegon NV ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegon NV ADR 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 Aegon NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegon NV ADR has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Aegon NV go up and down completely randomly.

Pair Corralation between Celsius Holdings and Aegon NV

Given the investment horizon of 90 days Celsius Holdings is expected to generate 2.88 times less return on investment than Aegon NV. In addition to that, Celsius Holdings is 2.25 times more volatile than Aegon NV ADR. It trades about 0.01 of its total potential returns per unit of risk. Aegon NV ADR is currently generating about 0.04 per unit of volatility. If you would invest  449.00  in Aegon NV ADR on September 23, 2024 and sell it today you would earn a total of  132.00  from holding Aegon NV ADR or generate 29.4% return on investment over 90 days.

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

Celsius Holdings  vs.  Aegon NV ADR

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 unfluctuating performance in the last few months, the Stock's essential indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Aegon NV ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aegon NV ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Celsius Holdings and Aegon NV

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

The idea behind Celsius Holdings and Aegon NV ADR 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 Anywhere module to track or share privately all of your investments from the convenience of any device.