Correlation Between Celestica and Oeneo SA

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

By analyzing existing cross correlation between Celestica and Oeneo SA, you can compare the effects of market volatilities on Celestica and Oeneo SA 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 Oeneo SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celestica and Oeneo SA.

Diversification Opportunities for Celestica and Oeneo SA

-0.78

Correlation Coefficient

Celestica  Oeneo SA

Pay attention - limited upside

The 3 months correlation between Celestica and Oeneo is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Celestica and Oeneo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oeneo SA 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 Oeneo SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oeneo SA has no effect on the direction of Celestica i.e., Celestica and Oeneo SA go up and down completely randomly.

Pair Corralation between Celestica and Oeneo SA

Considering the 90-day investment horizon Celestica is expected to under-perform the Oeneo SA. In addition to that, Celestica is 2.16 times more volatile than Oeneo SA. It trades about -0.07 of its total potential returns per unit of risk. Oeneo SA is currently generating about -0.13 per unit of volatility. If you would invest  1,060  in Oeneo SA on January 29, 2024 and sell it today you would lose (40.00) from holding Oeneo SA or give up 3.77% of portfolio value over 90 days.

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

Celestica  vs.  Oeneo SA

Celestica

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Celestica are ranked lower than 11 (%) 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.

Oeneo SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oeneo SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Celestica and Oeneo SA

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

The idea behind Celestica and Oeneo SA 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.