Correlation Between Glg Intl and Icon Natural
Can any of the company-specific risk be diversified away by investing in both Glg Intl and Icon Natural 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 Glg Intl and Icon Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glg Intl Small and Icon Natural Resources, you can compare the effects of market volatilities on Glg Intl and Icon Natural 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 Glg Intl with a short position of Icon Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glg Intl and Icon Natural.
Diversification Opportunities for Glg Intl and Icon Natural
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Glg and Icon is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Glg Intl Small and Icon Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Natural Resources and Glg Intl 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 Glg Intl Small are associated (or correlated) with Icon Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Natural Resources has no effect on the direction of Glg Intl i.e., Glg Intl and Icon Natural go up and down completely randomly.
Pair Corralation between Glg Intl and Icon Natural
Assuming the 90 days horizon Glg Intl Small is expected to generate 0.92 times more return on investment than Icon Natural. However, Glg Intl Small is 1.09 times less risky than Icon Natural. It trades about 0.09 of its potential returns per unit of risk. Icon Natural Resources is currently generating about 0.02 per unit of risk. If you would invest 5,555 in Glg Intl Small on November 30, 2024 and sell it today you would earn a total of 3,142 from holding Glg Intl Small or generate 56.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glg Intl Small vs. Icon Natural Resources
Performance |
| Timeline |
| Glg Intl Small |
| Icon Natural Resources |
Glg Intl and Icon Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glg Intl and Icon Natural
The main advantage of trading using opposite Glg Intl and Icon Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glg Intl position performs unexpectedly, Icon Natural 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 Natural will offset losses from the drop in Icon Natural's long position.| Glg Intl vs. Flexible Bond Portfolio | Glg Intl vs. Morningstar Defensive Bond | Glg Intl vs. Ab Bond Inflation | Glg Intl vs. Rbc Impact Bond |
| Icon Natural vs. Icon Financial Fund | Icon Natural vs. Dreyfus Natural Resources | Icon Natural vs. Icon Natural Resources | Icon Natural vs. Icon Information Technology |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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