Correlation Between Invesco Global and Icon Financial
Can any of the company-specific risk be diversified away by investing in both Invesco Global 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 Invesco Global and Icon Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Global Health and Icon Financial Fund, you can compare the effects of market volatilities on Invesco Global 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 Invesco Global with a short position of Icon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Global and Icon Financial.
Diversification Opportunities for Invesco Global and Icon Financial
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Invesco and Icon is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Global Health and Icon Financial Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Financial and Invesco Global 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 Invesco Global Health 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 Invesco Global i.e., Invesco Global and Icon Financial go up and down completely randomly.
Pair Corralation between Invesco Global and Icon Financial
Assuming the 90 days horizon Invesco Global Health is expected to under-perform the Icon Financial. But the mutual fund apears to be less risky and, when comparing its historical volatility, Invesco Global Health is 1.42 times less risky than Icon Financial. The mutual fund trades about -0.1 of its potential returns per unit of risk. The Icon Financial Fund is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,108 in Icon Financial Fund on August 28, 2024 and sell it today you would earn a total of 61.00 from holding Icon Financial Fund or generate 5.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Global Health vs. Icon Financial Fund
Performance |
| Timeline |
| Invesco Global Health |
| Icon Financial |
Invesco Global and Icon Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Global and Icon Financial
The main advantage of trading using opposite Invesco Global and Icon Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Global 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.| Invesco Global vs. Morgan Stanley Institutional | Invesco Global vs. L Abbett Fundamental | Invesco Global vs. Ips Strategic Capital | Invesco Global vs. Acm Tactical Income |
| Icon Financial vs. Highland Longshort Healthcare | Icon Financial vs. Invesco Global Health | Icon Financial vs. Tekla Healthcare Opportunities | Icon Financial vs. Live Oak Health |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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