Correlation Between Barings Us and Icon Financial
Can any of the company-specific risk be diversified away by investing in both Barings Us and Icon Financial 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 Barings Us and Icon Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings High Yield and Icon Financial Fund, you can compare the effects of market volatilities on Barings Us and Icon Financial 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 Barings Us with a short position of Icon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Us and Icon Financial.
Diversification Opportunities for Barings Us and Icon Financial
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Barings and Icon is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Barings High Yield and Icon Financial Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Financial and Barings Us 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 Barings High Yield are associated (or correlated) with Icon Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Financial has no effect on the direction of Barings Us i.e., Barings Us and Icon Financial go up and down completely randomly.
Pair Corralation between Barings Us and Icon Financial
Assuming the 90 days horizon Barings High Yield is expected to generate 0.22 times more return on investment than Icon Financial. However, Barings High Yield is 4.59 times less risky than Icon Financial. It trades about 0.15 of its potential returns per unit of risk. Icon Financial Fund is currently generating about 0.0 per unit of risk. If you would invest 695.00 in Barings High Yield on October 16, 2024 and sell it today you would earn a total of 114.00 from holding Barings High Yield or generate 16.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings High Yield vs. Icon Financial Fund
Performance |
| Timeline |
| Barings High Yield |
| Icon Financial |
Barings Us and Icon Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Us and Icon Financial
The main advantage of trading using opposite Barings Us and Icon Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Us position performs unexpectedly, Icon Financial 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 Financial will offset losses from the drop in Icon Financial's long position.| Barings Us vs. Tfa Alphagen Growth | Barings Us vs. Small Pany Growth | Barings Us vs. Rational Defensive Growth | Barings Us vs. Mid Cap Growth |
| Icon Financial vs. Barings High Yield | Icon Financial vs. Siit High Yield | Icon Financial vs. Lgm Risk Managed | Icon Financial vs. Msift High Yield |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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