Correlation Between Flex and Celestica
Can any of the company-specific risk be diversified away by investing in both Flex and Celestica 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 Flex and Celestica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flex and Celestica, you can compare the effects of market volatilities on Flex and Celestica 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 Flex with a short position of Celestica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flex and Celestica.
Diversification Opportunities for Flex and Celestica
Poor diversification
The 3 months correlation between Flex and Celestica is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Flex and Celestica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celestica and Flex 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 Flex are associated (or correlated) with Celestica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celestica has no effect on the direction of Flex i.e., Flex and Celestica go up and down completely randomly.
Pair Corralation between Flex and Celestica
Given the investment horizon of 90 days Flex is expected to generate 2.23 times less return on investment than Celestica. But when comparing it to its historical volatility, Flex is 1.81 times less risky than Celestica. It trades about 0.2 of its potential returns per unit of risk. Celestica is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 11,664 in Celestica on June 2, 2025 and sell it today you would earn a total of 7,811 from holding Celestica or generate 66.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flex vs. Celestica
Performance |
| Timeline |
| Flex |
| Celestica |
Flex and Celestica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flex and Celestica
The main advantage of trading using opposite Flex and Celestica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flex position performs unexpectedly, Celestica 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 Celestica will offset losses from the drop in Celestica's long position.The idea behind Flex and Celestica 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.| Celestica vs. Plexus Corp | Celestica vs. Benchmark Electronics | Celestica vs. Flex | Celestica vs. Jabil Circuit |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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