Correlation Between Celsius Holdings and Alchemy Investments

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

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

Diversification Opportunities for Celsius Holdings and Alchemy Investments

-0.43

Correlation Coefficient

Celsius Holdings  Alchemy Investments

Very good diversification

The 3 months correlation between Celsius and Alchemy is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Alchemy Investments Acquisitio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alchemy Investments 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 Alchemy Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alchemy Investments has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Alchemy Investments go up and down completely randomly.

Pair Corralation between Celsius Holdings and Alchemy Investments

Given the investment horizon of 90 days Celsius Holdings is expected to under-perform the Alchemy Investments. In addition to that, Celsius Holdings is 4.64 times more volatile than Alchemy Investments Acquisition. It trades about -0.07 of its total potential returns per unit of risk. Alchemy Investments Acquisition is currently generating about -0.09 per unit of volatility. If you would invest  1,111  in Alchemy Investments Acquisition on September 29, 2024 and sell it today you would lose (17.00) from holding Alchemy Investments Acquisition or give up 1.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Celsius Holdings  vs.  Alchemy Investments Acquisitio

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.

Alchemy Investments

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alchemy Investments Acquisition are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong fundamental indicators, Alchemy Investments is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Celsius Holdings and Alchemy Investments

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

The idea behind Celsius Holdings and Alchemy Investments Acquisition 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.