Correlation Between Stericycle and Clean Harbors

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

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

Diversification Opportunities for Stericycle and Clean Harbors

0.0

Correlation Coefficient

Stericycle  Clean Harbors

Pay attention - limited upside

The 3 months correlation between Stericycle and Clean is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Stericycle and Clean Harbors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Harbors and Stericycle 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 Stericycle are associated (or correlated) with Clean Harbors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Harbors has no effect on the direction of Stericycle i.e., Stericycle and Clean Harbors go up and down completely randomly.

Pair Corralation between Stericycle and Clean Harbors

If you would invest (100.00) in Stericycle on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Stericycle or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Stericycle  vs.  Clean Harbors

Stericycle

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stericycle has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, Stericycle is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Clean Harbors

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clean Harbors 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 April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Stericycle and Clean Harbors

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

The idea behind Stericycle and Clean Harbors 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.