Correlation Between ES Ceramics and Icon Offshore
Can any of the company-specific risk be diversified away by investing in both ES Ceramics and Icon Offshore 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 ES Ceramics and Icon Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ES Ceramics Technology and Icon Offshore Bhd, you can compare the effects of market volatilities on ES Ceramics and Icon Offshore 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 ES Ceramics with a short position of Icon Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of ES Ceramics and Icon Offshore.
Diversification Opportunities for ES Ceramics and Icon Offshore
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 0100 and Icon is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding ES Ceramics Technology and Icon Offshore Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Offshore Bhd and ES Ceramics 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 ES Ceramics Technology are associated (or correlated) with Icon Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Offshore Bhd has no effect on the direction of ES Ceramics i.e., ES Ceramics and Icon Offshore go up and down completely randomly.
Pair Corralation between ES Ceramics and Icon Offshore
Assuming the 90 days trading horizon ES Ceramics Technology is expected to under-perform the Icon Offshore. But the stock apears to be less risky and, when comparing its historical volatility, ES Ceramics Technology is 1.14 times less risky than Icon Offshore. The stock trades about -0.02 of its potential returns per unit of risk. The Icon Offshore Bhd is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 52.00 in Icon Offshore Bhd on September 4, 2024 and sell it today you would earn a total of 55.00 from holding Icon Offshore Bhd or generate 105.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.37% |
| Values | Daily Returns |
ES Ceramics Technology vs. Icon Offshore Bhd
Performance |
| Timeline |
| ES Ceramics Technology |
| Icon Offshore Bhd |
ES Ceramics and Icon Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ES Ceramics and Icon Offshore
The main advantage of trading using opposite ES Ceramics and Icon Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ES Ceramics position performs unexpectedly, Icon Offshore 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 Icon Offshore will offset losses from the drop in Icon Offshore's long position.| ES Ceramics vs. Minetech Resources Bhd | ES Ceramics vs. Swift Haulage Bhd | ES Ceramics vs. Insas Bhd | ES Ceramics vs. Bina Darulaman Bhd |
| Icon Offshore vs. Binasat Communications Bhd | Icon Offshore vs. BP Plastics Holding | Icon Offshore vs. Oriental Food Industries | Icon Offshore vs. Silver Ridge Holdings |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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