Correlation Between XL Fleet and Celsius Holdings

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

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

Diversification Opportunities for XL Fleet and Celsius Holdings

0.1

Correlation Coefficient

XL Fleet  Celsius Holdings

Average diversification

The 3 months correlation between XL Fleet and Celsius is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding XL Fleet Corp and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings and XL Fleet 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 XL Fleet Corp 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 XL Fleet i.e., XL Fleet and Celsius Holdings go up and down completely randomly.

Pair Corralation between XL Fleet and Celsius Holdings

If you would invest  2,579  in Celsius Holdings on October 17, 2024 and sell it today you would earn a total of  108.00  from holding Celsius Holdings or generate 4.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	2.63%
Values	Daily Returns

XL Fleet Corp  vs.  Celsius Holdings

XL Fleet Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

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.

Pair Trading with XL Fleet and Celsius Holdings

The main advantage of trading using opposite XL Fleet and Celsius Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XL Fleet 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 XL Fleet Corp 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.

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.