Correlation Between Ashmore Emerging and Icon Bond
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Icon Bond 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 Ashmore Emerging and Icon Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Icon Bond Fund, you can compare the effects of market volatilities on Ashmore Emerging and Icon Bond 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 Ashmore Emerging with a short position of Icon Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Icon Bond.
Diversification Opportunities for Ashmore Emerging and Icon Bond
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ashmore and Icon is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Icon Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Bond Fund and Ashmore Emerging 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 Ashmore Emerging Markets are associated (or correlated) with Icon Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Bond Fund has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Icon Bond go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Icon Bond
Assuming the 90 days horizon Ashmore Emerging Markets is expected to generate 3.12 times more return on investment than Icon Bond. However, Ashmore Emerging is 3.12 times more volatile than Icon Bond Fund. It trades about 0.13 of its potential returns per unit of risk. Icon Bond Fund is currently generating about 0.26 per unit of risk. If you would invest 445.00 in Ashmore Emerging Markets on September 1, 2024 and sell it today you would earn a total of 30.00 from holding Ashmore Emerging Markets or generate 6.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Icon Bond Fund
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Icon Bond Fund |
Ashmore Emerging and Icon Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Icon Bond
The main advantage of trading using opposite Ashmore Emerging and Icon Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Icon Bond 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 Bond will offset losses from the drop in Icon Bond's long position.| Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets |
| Icon Bond vs. Icon Bond Fund | Icon Bond vs. Icon Equity Income | Icon Bond vs. Icon Longshort Fund | Icon Bond vs. Icon Longshort Fund |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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