Correlation Between Celestica and Abrdn Bloomberg

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

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

Diversification Opportunities for Celestica and Abrdn Bloomberg

0.54

Correlation Coefficient

Celestica  Abrdn Bloomberg

Very weak diversification

The 3 months correlation between Celestica and Abrdn is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Celestica and abrdn Bloomberg All in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn Bloomberg All and Celestica 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 Celestica are associated (or correlated) with Abrdn Bloomberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn Bloomberg All has no effect on the direction of Celestica i.e., Celestica and Abrdn Bloomberg go up and down completely randomly.

Pair Corralation between Celestica and Abrdn Bloomberg

Considering the 90-day investment horizon Celestica is expected to under-perform the Abrdn Bloomberg. In addition to that, Celestica is 6.15 times more volatile than abrdn Bloomberg All. It trades about -0.04 of its total potential returns per unit of risk. abrdn Bloomberg All is currently generating about 0.37 per unit of volatility. If you would invest  1,977  in abrdn Bloomberg All on January 28, 2024 and sell it today you would earn a total of  77.00  from holding abrdn Bloomberg All or generate 3.89% return on investment over 90 days.

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

Celestica  vs.  abrdn Bloomberg All

Celestica

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Celestica are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak essential indicators, Celestica unveiled solid returns over the last few months and may actually be approaching a breakup point.

abrdn Bloomberg All

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in abrdn Bloomberg All are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Abrdn Bloomberg is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Celestica and Abrdn Bloomberg

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

The idea behind Celestica and abrdn Bloomberg All 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.