Correlation Between Icon Offshore and OpenSys M
Can any of the company-specific risk be diversified away by investing in both Icon Offshore and OpenSys M 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 Icon Offshore and OpenSys M into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Offshore Bhd and OpenSys M Bhd, you can compare the effects of market volatilities on Icon Offshore and OpenSys M 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 Icon Offshore with a short position of OpenSys M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Offshore and OpenSys M.
Diversification Opportunities for Icon Offshore and OpenSys M
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Icon and OpenSys is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Icon Offshore Bhd and OpenSys M Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OpenSys M Bhd and Icon Offshore 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 Icon Offshore Bhd are associated (or correlated) with OpenSys M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OpenSys M Bhd has no effect on the direction of Icon Offshore i.e., Icon Offshore and OpenSys M go up and down completely randomly.
Pair Corralation between Icon Offshore and OpenSys M
Assuming the 90 days trading horizon Icon Offshore Bhd is expected to under-perform the OpenSys M. But the stock apears to be less risky and, when comparing its historical volatility, Icon Offshore Bhd is 1.55 times less risky than OpenSys M. The stock trades about -0.1 of its potential returns per unit of risk. The OpenSys M Bhd is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 35.00 in OpenSys M Bhd on October 23, 2024 and sell it today you would earn a total of 0.00 from holding OpenSys M Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Icon Offshore Bhd vs. OpenSys M Bhd
Performance |
| Timeline |
| Icon Offshore Bhd |
| OpenSys M Bhd |
Icon Offshore and OpenSys M Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Offshore and OpenSys M
The main advantage of trading using opposite Icon Offshore and OpenSys M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Offshore position performs unexpectedly, OpenSys M 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 OpenSys M will offset losses from the drop in OpenSys M's long position.| Icon Offshore vs. Mercury Industries Bhd | Icon Offshore vs. MClean Technologies Bhd | Icon Offshore vs. CSC Steel Holdings | Icon Offshore vs. Leader Steel Holdings |
| OpenSys M vs. ES Ceramics Technology | OpenSys M vs. Minetech Resources Bhd | OpenSys M vs. Dufu Tech Corp | OpenSys M vs. Tex Cycle Technology |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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