Correlation Between Icon Offshore and Cloudpoint Technology
Can any of the company-specific risk be diversified away by investing in both Icon Offshore and Cloudpoint Technology 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 Cloudpoint Technology 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 Cloudpoint Technology Berhad, you can compare the effects of market volatilities on Icon Offshore and Cloudpoint Technology 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 Cloudpoint Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Offshore and Cloudpoint Technology.
Diversification Opportunities for Icon Offshore and Cloudpoint Technology
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Icon and Cloudpoint is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Icon Offshore Bhd and Cloudpoint Technology Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cloudpoint Technology 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 Cloudpoint Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cloudpoint Technology has no effect on the direction of Icon Offshore i.e., Icon Offshore and Cloudpoint Technology go up and down completely randomly.
Pair Corralation between Icon Offshore and Cloudpoint Technology
Assuming the 90 days trading horizon Icon Offshore Bhd is expected to generate 1.48 times more return on investment than Cloudpoint Technology. However, Icon Offshore is 1.48 times more volatile than Cloudpoint Technology Berhad. It trades about 0.05 of its potential returns per unit of risk. Cloudpoint Technology Berhad is currently generating about 0.07 per unit of risk. If you would invest 53.00 in Icon Offshore Bhd on November 4, 2024 and sell it today you would earn a total of 47.00 from holding Icon Offshore Bhd or generate 88.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 85.6% |
| Values | Daily Returns |
Icon Offshore Bhd vs. Cloudpoint Technology Berhad
Performance |
| Timeline |
| Icon Offshore Bhd |
| Cloudpoint Technology |
Icon Offshore and Cloudpoint Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Offshore and Cloudpoint Technology
The main advantage of trading using opposite Icon Offshore and Cloudpoint Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Offshore position performs unexpectedly, Cloudpoint Technology 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 Cloudpoint Technology will offset losses from the drop in Cloudpoint Technology's long position.| Icon Offshore vs. Barakah Offshore Petroleum | Icon Offshore vs. Daya Materials Bhd | Icon Offshore vs. JAKS Resources Bhd | Icon Offshore vs. PESTECH International Bhd |
| Cloudpoint Technology vs. Malayan Banking Bhd | Cloudpoint Technology vs. Public Bank Bhd | Cloudpoint Technology vs. Petronas Chemicals Group | Cloudpoint Technology vs. Tenaga Nasional Bhd |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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