Correlation Between Celsius Holdings and BKV

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

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

Diversification Opportunities for Celsius Holdings and BKV

-0.61

Correlation Coefficient

Celsius Holdings  BKV

Excellent diversification

The 3 months correlation between Celsius and BKV is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and BKV Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BKV Corporation 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 BKV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BKV Corporation has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and BKV go up and down completely randomly.

Pair Corralation between Celsius Holdings and BKV

Given the investment horizon of 90 days Celsius Holdings is expected to generate 93.93 times less return on investment than BKV. In addition to that, Celsius Holdings is 1.97 times more volatile than BKV Corporation. It trades about 0.0 of its total potential returns per unit of risk. BKV Corporation is currently generating about 0.22 per unit of volatility. If you would invest  1,800  in BKV Corporation on October 4, 2024 and sell it today you would earn a total of  550.00  from holding BKV Corporation or generate 30.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	13.91%
Values	Daily Returns

Celsius Holdings  vs.  BKV Corp.

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 fairly strong essential indicators, Celsius Holdings is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

BKV Corporation

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in BKV Corporation are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile forward-looking signals, BKV showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celsius Holdings and BKV

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

The idea behind Celsius Holdings and BKV Corporation 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.