Correlation Between Celsius Holdings and SIMON

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

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

Diversification Opportunities for Celsius Holdings and SIMON

0.21

Correlation Coefficient

Celsius Holdings  SIMON

Modest diversification

The 3 months correlation between Celsius and SIMON is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and SIMON PPTY GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIMON PPTY GROUP 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 SIMON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIMON PPTY GROUP has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and SIMON go up and down completely randomly.

Pair Corralation between Celsius Holdings and SIMON

Given the investment horizon of 90 days Celsius Holdings is expected to generate 4.39 times more return on investment than SIMON. However, Celsius Holdings is 4.39 times more volatile than SIMON PPTY GROUP. It trades about -0.03 of its potential returns per unit of risk. SIMON PPTY GROUP is currently generating about -0.21 per unit of risk. If you would invest  2,794  in Celsius Holdings on October 20, 2024 and sell it today you would lose (71.00) from holding Celsius Holdings or give up 2.54% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Celsius Holdings  vs.  SIMON PPTY GROUP

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 February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

SIMON PPTY GROUP

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SIMON PPTY GROUP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SIMON is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Celsius Holdings and SIMON

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

The idea behind Celsius Holdings and SIMON PPTY GROUP 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.