Correlation Between Icon Natural and Scharf Fund
Can any of the company-specific risk be diversified away by investing in both Icon Natural and Scharf Fund 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 Icon Natural and Scharf Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Natural Resources and Scharf Fund Retail, you can compare the effects of market volatilities on Icon Natural and Scharf Fund 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 Icon Natural with a short position of Scharf Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Natural and Scharf Fund.
Diversification Opportunities for Icon Natural and Scharf Fund
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Icon and Scharf is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Icon Natural Resources and Scharf Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scharf Fund Retail and Icon Natural 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 Icon Natural Resources are associated (or correlated) with Scharf Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scharf Fund Retail has no effect on the direction of Icon Natural i.e., Icon Natural and Scharf Fund go up and down completely randomly.
Pair Corralation between Icon Natural and Scharf Fund
Assuming the 90 days horizon Icon Natural Resources is expected to generate 1.49 times more return on investment than Scharf Fund. However, Icon Natural is 1.49 times more volatile than Scharf Fund Retail. It trades about 0.14 of its potential returns per unit of risk. Scharf Fund Retail is currently generating about -0.12 per unit of risk. If you would invest 1,769 in Icon Natural Resources on September 13, 2024 and sell it today you would earn a total of 36.00 from holding Icon Natural Resources or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Natural Resources vs. Scharf Fund Retail
Performance |
| Timeline |
| Icon Natural Resources |
| Scharf Fund Retail |
Icon Natural and Scharf Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Natural and Scharf Fund
The main advantage of trading using opposite Icon Natural and Scharf Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Natural position performs unexpectedly, Scharf Fund 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 Scharf Fund will offset losses from the drop in Scharf Fund's long position.| Icon Natural vs. Icon Financial Fund | Icon Natural vs. Dreyfus Natural Resources | Icon Natural vs. Icon Natural Resources | Icon Natural vs. Icon Information Technology |
| Scharf Fund vs. Barings Emerging Markets | Scharf Fund vs. Extended Market Index | Scharf Fund vs. T Rowe Price | Scharf Fund vs. Western Asset Diversified |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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