Correlation Between Pharol SGPS and Celsius Holdings

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

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

Diversification Opportunities for Pharol SGPS and Celsius Holdings

0.58

Correlation Coefficient

Pharol SGPS  Celsius Holdings

Very weak diversification

The 3 months correlation between Pharol and Celsius is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Pharol SGPS SA and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings and Pharol SGPS 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 Pharol SGPS SA 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 Pharol SGPS i.e., Pharol SGPS and Celsius Holdings go up and down completely randomly.

Pair Corralation between Pharol SGPS and Celsius Holdings

If you would invest  2,579  in Celsius Holdings on September 18, 2024 and sell it today you would earn a total of  515.00  from holding Celsius Holdings or generate 19.97% return on investment over 90 days.

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

Pharol SGPS SA  vs.  Celsius Holdings

Pharol SGPS SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pharol SGPS SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

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 fairly strong essential indicators, Celsius Holdings is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Pharol SGPS and Celsius Holdings

The main advantage of trading using opposite Pharol SGPS and Celsius Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pharol SGPS 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 Pharol SGPS SA 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 Stocks Directory module to find actively traded stocks across global markets.