Correlation Between Celsius Holdings and 360 Finance

Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and 360 Finance 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 360 Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Celsius Holdings and 360 Finance, you can compare the effects of market volatilities on Celsius Holdings and 360 Finance 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 360 Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and 360 Finance.

Diversification Opportunities for Celsius Holdings and 360 Finance

-0.25

Correlation Coefficient

Celsius Holdings  360 Finance

Very good diversification

The 3 months correlation between Celsius and 360 is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and 360 Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 360 Finance 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 360 Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 360 Finance has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and 360 Finance go up and down completely randomly.

Pair Corralation between Celsius Holdings and 360 Finance

Given the investment horizon of 90 days Celsius Holdings is expected to under-perform the 360 Finance. In addition to that, Celsius Holdings is 1.11 times more volatile than 360 Finance. It trades about -0.01 of its total potential returns per unit of risk. 360 Finance is currently generating about 0.15 per unit of volatility. If you would invest  3,235  in 360 Finance on October 7, 2024 and sell it today you would earn a total of  632.00  from holding 360 Finance or generate 19.54% return on investment over 90 days.

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

Celsius Holdings  vs.  360 Finance

Celsius Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Celsius Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong essential indicators, Celsius Holdings is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

360 Finance

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in 360 Finance are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain forward indicators, 360 Finance displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celsius Holdings and 360 Finance

The main advantage of trading using opposite Celsius Holdings and 360 Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, 360 Finance 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 360 Finance will offset losses from the drop in 360 Finance's long position.

The idea behind Celsius Holdings and 360 Finance 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.