Correlation Between Celsius Holdings and Vast Renewables

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

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

Diversification Opportunities for Celsius Holdings and Vast Renewables

0.01

Correlation Coefficient

Celsius Holdings  Vast Renewables

Significant diversification

The 3 months correlation between Celsius and Vast is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Vast Renewables Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vast Renewables 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 Vast Renewables. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vast Renewables has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Vast Renewables go up and down completely randomly.

Pair Corralation between Celsius Holdings and Vast Renewables

Given the investment horizon of 90 days Celsius Holdings is expected to generate 0.43 times more return on investment than Vast Renewables. However, Celsius Holdings is 2.3 times less risky than Vast Renewables. It trades about -0.04 of its potential returns per unit of risk. Vast Renewables Limited is currently generating about -0.11 per unit of risk. If you would invest  3,056  in Celsius Holdings on October 10, 2024 and sell it today you would lose (136.00) from holding Celsius Holdings or give up 4.45% of portfolio value over 90 days.

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

Celsius Holdings  vs.  Vast Renewables Limited

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.

Vast Renewables

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vast Renewables Limited are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Vast Renewables exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celsius Holdings and Vast Renewables

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

The idea behind Celsius Holdings and Vast Renewables Limited 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.