Correlation Between Blue Line and ICTS International
Can any of the company-specific risk be diversified away by investing in both Blue Line and ICTS International 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 Blue Line and ICTS International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Line Protection and ICTS International NV, you can compare the effects of market volatilities on Blue Line and ICTS International 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 Blue Line with a short position of ICTS International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Line and ICTS International.
Diversification Opportunities for Blue Line and ICTS International
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Blue and ICTS is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Blue Line Protection and ICTS International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICTS International and Blue Line 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 Blue Line Protection are associated (or correlated) with ICTS International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICTS International has no effect on the direction of Blue Line i.e., Blue Line and ICTS International go up and down completely randomly.
Pair Corralation between Blue Line and ICTS International
Given the investment horizon of 90 days Blue Line Protection is expected to under-perform the ICTS International. In addition to that, Blue Line is 2.37 times more volatile than ICTS International NV. It trades about -0.06 of its total potential returns per unit of risk. ICTS International NV is currently generating about -0.05 per unit of volatility. If you would invest 493.00 in ICTS International NV on August 31, 2024 and sell it today you would lose (43.00) from holding ICTS International NV or give up 8.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Line Protection vs. ICTS International NV
Performance |
| Timeline |
| Blue Line Protection |
| ICTS International |
Blue Line and ICTS International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Line and ICTS International
The main advantage of trading using opposite Blue Line and ICTS International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Line position performs unexpectedly, ICTS International 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 ICTS International will offset losses from the drop in ICTS International's long position.| Blue Line vs. Seychelle Environmtl | Blue Line vs. Energy and Water | Blue Line vs. One World Universe | Blue Line vs. Vow ASA |
| ICTS International vs. Seychelle Environmtl | ICTS International vs. Energy and Water | ICTS International vs. One World Universe | ICTS International vs. Vow ASA |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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