Correlation Between Celsius Holdings and Almacenes Xito

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

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

Diversification Opportunities for Celsius Holdings and Almacenes Xito

0.14

Correlation Coefficient

Celsius Holdings  Almacenes Xito

Average diversification

The 3 months correlation between Celsius and Almacenes is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Almacenes xito SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almacenes xito SA 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 Almacenes Xito. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almacenes xito SA has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Almacenes Xito go up and down completely randomly.

Pair Corralation between Celsius Holdings and Almacenes Xito

Given the investment horizon of 90 days Celsius Holdings is expected to generate 2.31 times more return on investment than Almacenes Xito. However, Celsius Holdings is 2.31 times more volatile than Almacenes xito SA. It trades about 0.1 of its potential returns per unit of risk. Almacenes xito SA is currently generating about 0.13 per unit of risk. If you would invest  2,585  in Celsius Holdings on December 30, 2024 and sell it today you would earn a total of  780.00  from holding Celsius Holdings or generate 30.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	80.65%
Values	Daily Returns

Celsius Holdings  vs.  Almacenes xito SA

Celsius Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Celsius Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating essential indicators, Celsius Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Almacenes xito SA

Risk-Adjusted Performance

OK

Over the last 90 days Almacenes xito SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very weak basic indicators, Almacenes Xito displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celsius Holdings and Almacenes Xito

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

The idea behind Celsius Holdings and Almacenes xito SA 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.