Correlation Between Fly E and Celsius Holdings

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

By analyzing existing cross correlation between Fly E Group, Common and Celsius Holdings, you can compare the effects of market volatilities on Fly E and Celsius Holdings 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 Fly E with a short position of Celsius Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fly E and Celsius Holdings.

Diversification Opportunities for Fly E and Celsius Holdings

0.4

Correlation Coefficient

Fly E  Celsius Holdings

Very weak diversification

The 3 months correlation between Fly and Celsius is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Fly E Group, Common and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings and Fly E 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 Fly E Group, Common are associated (or correlated) with Celsius Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celsius Holdings has no effect on the direction of Fly E i.e., Fly E and Celsius Holdings go up and down completely randomly.

Pair Corralation between Fly E and Celsius Holdings

Given the investment horizon of 90 days Fly E Group, Common is expected to under-perform the Celsius Holdings. In addition to that, Fly E is 1.5 times more volatile than Celsius Holdings. It trades about -0.09 of its total potential returns per unit of risk. Celsius Holdings is currently generating about -0.08 per unit of volatility. If you would invest  3,664  in Celsius Holdings on September 3, 2024 and sell it today you would lose (800.00) from holding Celsius Holdings or give up 21.83% of portfolio value over 90 days.

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

Fly E Group, Common  vs.  Celsius Holdings

Fly E Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fly E Group, Common has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

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

Pair Trading with Fly E and Celsius Holdings

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

The idea behind Fly E Group, Common and Celsius Holdings 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.