Correlation Between Information Technology and Capital ICE
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By analyzing existing cross correlation between Information Technology Total and Capital ICE International15, you can compare the effects of market volatilities on Information Technology and Capital ICE 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 Information Technology with a short position of Capital ICE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Information Technology and Capital ICE.
Diversification Opportunities for Information Technology and Capital ICE
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Information and Capital is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Information Technology Total and Capital ICE International15 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital ICE Internat and Information Technology 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 Information Technology Total are associated (or correlated) with Capital ICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital ICE Internat has no effect on the direction of Information Technology i.e., Information Technology and Capital ICE go up and down completely randomly.
Pair Corralation between Information Technology and Capital ICE
Assuming the 90 days trading horizon Information Technology Total is expected to under-perform the Capital ICE. In addition to that, Information Technology is 3.94 times more volatile than Capital ICE International15. It trades about -0.11 of its total potential returns per unit of risk. Capital ICE International15 is currently generating about 0.33 per unit of volatility. If you would invest 3,224 in Capital ICE International15 on September 5, 2024 and sell it today you would earn a total of 98.00 from holding Capital ICE International15 or generate 3.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Information Technology Total vs. Capital ICE International15
Performance |
| Timeline |
| Information Technology |
| Capital ICE Internat |
Information Technology and Capital ICE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Information Technology and Capital ICE
The main advantage of trading using opposite Information Technology and Capital ICE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Information Technology position performs unexpectedly, Capital ICE 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 Capital ICE will offset losses from the drop in Capital ICE's long position.| Information Technology vs. ESUN Financial Holding | Information Technology vs. Lelon Electronics Corp | Information Technology vs. Newretail Co | Information Technology vs. Elan Microelectronics Corp |
| Capital ICE vs. Ruentex Development Co | Capital ICE vs. Symtek Automation Asia | Capital ICE vs. CTCI Corp | Capital ICE vs. Information Technology Total |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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